Private Equity Firms ‘Circle’ NCC Group’s Escode

Several private equity firms are considering bidding for Escode, one of the main subsidiaries of London-listed cybersecurity firm NCC Group, Sky News reported.

Montagu Private Equity and Bridgepoint are two of the buyout firms interested in Escode, which specialises in software escrow and verification services, the report said.

A deal for Escode could be worth between £300 and £400m, compared to a market value of just over £440m for all of NCC Group as of Monday’s close, according to Sky’s report.

Buyout interest

The report said several other private equity firms are also said to be interested, but a formal auction is not underway and the identities of the other parties was unclear.

NCC Group said in a statement that it is considering various strategic options for Escode, including a possible sale, but that it had received no proposals as yet and had made no decision regarding a transaction.

Shares in NCC Group rose as high as 12 percent during Monday trading amidst speculation around a takeover of part of the company, before closing up about 4 percent.

NCC previously carried out a string of reviews about potential disposals and said in January it had decided “not to restart the strategic review of Escode at this juncture”.

Other parts of the company have also been the subject of exploratory discussions with possible buyers, Sky reported.

Reviewing options

The company employs about 2,200 people across Europe, North America and Asia-Pacific.

On Monday it said it had signed a £120m loan facility with a syndicate of banks including Barclays, HSBC, NatWest and Santander UK.

NCC’s main business is cybersecurity, and it has worked with major corporate clients including ByteDance’s TikTok.

The Manchester-based company in February 2023 followed other tech players in announcing job cuts amounting to more than 125 staff as part of a strategic review.