Intertek buys EWA Canada for foothold in internet-of-things
(ShareCast News) - Quality assurance provider Intertek has snapped up cyber security specialist EWA Canada from Electronic Warfare Associates for an undisclosed sum, in order to take hold of an opportunity in the 'internet of things' market.
The addition of Ottawa-based EWA Canada, which employs 54 people and generated revenues of about CA$15m in 2015, will enable Intertek to perform security evaluations on its products and networks and provide custom security assurance solutions to its customers as well as expand EWA Canada's customer base.
Intertek chief executive André Lacroix said the acquisition of a cyber security assurance provider will broaden the company's total quality customer offering to seize the growth opportunities in the fast-growing internet of things market.
It is estimated that there will be more than 20bn connected devices by 2020 as the internet of things market grows with products and devices connected wirelessly.
He added: "The expansion of our assurance, testing, inspection, and certification differentiated value proposition in cyber security is in line with our portfolio strategy of investing in fast growing businesses with good margin prospects."
Broker Shore Capital said it was an "interesting" acquisition, yet remained cautious on the shares from an investment perspective on valuation grounds.
Analyst Robin Speakman noted that that the inexorable increase in goods being given internet connection ability and a greater measure of intelligence poses questions on potential security issues, but also on those of interoperability: "This is an emerging test environment, one likely to be critical for many types of good (both consumer and industry/social) in the future.
"So, the commercial logic of the acquisition, stretching Intertek's exposure and capability does not seem in question to us. EWA-Canada will enable Intertek to perform security evaluations and both products and networks for clients, broadening client services and confirming the strategic importance of Intertek as a services partner. That said, we believe that specialist cyber security providers will be able to offer broader offerings to clients than the likes of Intertek, this is a market that will be difficult to dominate, in our view."