Arm looks to sell off loss-making security venture
The security software firm has haemorrhaged cash since its launch seven years ago
Digital security firm Gemalto and chip designer ARM are looking to put their joint cyber security venture Trustonic up for sale in light of persistent losses.
The loss-making software company, which builds security technology for mobile phones and applications, is looking for bidders seven years after its creation, according to the Telegraph.
This is because Trustonic has lost money in every year since its inception, despite attracting a string of prominent clients in the last few years. The likes of Casio, for example, uses Trustonic to build protection into its smartwatches, and Volkswagen to secure a keyless car-entry app.
The technology has been used in a host of applications, from building secure fingerprint scanners for smartphones, to allowing sensitive data to be stored on devices.
This success, however, has not translated into profit, and the current shareholders of the business have decided to make the company available for sale.
The joint parent company Arm, moreover, has sustained losses recently, with figures showing an operating loss of £8.6 million in the third quarter of 2019, with revenues also declining. In fact, the British chip designer has not recorded a quarterly profit since Softbank launched a successful £24.3 billion takeover in 2016.
The company’s documents suggest that the company may be valued at approximately £60 million, based on figures from its last fundraising round, although there is no official figure attached or disclosed.
Trustonic was founded by former Arm executive Ben Cade in 2012 along with the Dutch security software makers Gemalto and German company Giesecke & Devrient, and employs more than a hundred people in its Cambridge-based offices, according to Growjo.
Arm recently partnered with the Department for Business, Energy and Industrial Strategy (BEIS) to build hack-resistant chip technology through a £36 million investment spread across five years.
Cade declined to comment went approached by the Telegraph, but said: “We need to grow the business. It didn’t make sense any more to do this as a joint venture.”
IT Pro approached Arm for a statement on the touted sale.