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Signicat in talks with five targets, likely to sign deal by 3Q24 – CEO

Signicat, a Norway-based provider of digital identity and electronic signature solutions, is in active talks with five targets and is likely to sign a deal within the next twelve months, CEO Asger Hattel told Mergermarket.

The Nordic Capital-backed company has a list of 50 potential acquisition targets and aims to make one or two acquisitions annually in the next three years if companies living up to Signicats’ criteria for a strong fit are identified, he said.

“Although the last year’s turmoil in the financial markets has made it more difficult to close deals, we are continuing to see acquisitions as an important part of our strategy”, Hattel stated.

Signicat primarily targets companies with turnover from EUR 10m to EUR 50m, he said.

The focus is on companies that can complement and strengthen Signicat’s digital identity platform and reach a larger addressable market, the CEO said.

It is looking at companies with scalable technology, which are market leaders with a strong footprint, he added.

the company is eyeing targets in the Nordic and the Baltic region, Hattel said. It is also looking at major markets in Europe such as Germany, France, Spain, Italy, and the UK, he said, adding that buying a market leader in the US is a possible move in the next five years.

In April 2022, Signicat announced the acquisition of UK-headquartered Sphonic, which is specialized in automation of decision-making processes for regulatory compliance.

“The acquisition has given us a very strong setup in London which we can use for further growth across the UK”, Hattel said.

Other interesting segments for Signicat would be AML (anti-money laundering) and anti-fraud, he added.

In August 2021, Signicat announced the acquisition of Dokobit, a Lithuanian electronic signature and ID portal provider.

Signicat has an internal M&A team and is using a number of unnamed advisers, Hattel said. It is also open to advisory approaches, he added.

In 2021, it reported turnover of around NOK 619m primarily from recurring subscriptions and transaction fees. FY22 turnover exceeded NOK 825m and turnover in 2023 is expected to exceed NOK 1bn, the CEO stated.

The Trondheim-based company was founded in 2007, and in April 2019 Nordic Capital became the company’s majority owner.

In April 2022, it was reported that Nordic Capital had begun preparations to exit Signicat, but in August of the same year, it was reported that it had stopped sale plans after offers for the company came in below valuation expectations.

Nordic Capital declined to comment.

At the time of publication, Signicat has a score of 68 out of 100, according to Mergermarket’s Likely to Exit (LTE) predictive algorithm, with its acquisition strategy significantly influencing the score.*

Signicat has around 450 employees around offices in Norway, Sweden, Finland, Denmark, Iceland, France, Germany, Lithuania, the Netherlands, Portugal, Romania, Spain and UK.

Its competitors include Swedish Scrive, German IDnow, and US-based PandaDoc and Docusign, as reported.

*Mergermarket‘s LTE predictive analytics assign a score to sponsor-backed companies to help track and predict when an exit could occur through M&A, an IPO, a direct listing or a deSPAC transaction.