Cork-based cyber security company Smarttech247 is planning to list on London’s Alternative Investment Market via a reverse takeover mechanism involving Conduity Capital.

A cash shell, Conduity will acquire Smarttech by issuing shares worth £33.5m (€39.3m).

A reverse takeover enables firms to secure a stock market listing without having to engage in an initial public offering process.

Smarttech247 founder and chief executive Ronan Murphy said that the company was introduced to Conduity by Fortified Advisory as a potential partner to help achieve a listing for the Irish business via a reverse takeover.

“We are therefore very much looking forward to working with the board of Conduity towards the completion of the transaction which, I believe, will enable us to continue to drive the business forward to the next level,” he said.

Mr Murphy said he believes Smarttech247 is well placed to become a “global leader in the automated managed detection and response space”.

“We have a proven track record, strong revenues and growth plans and a fantastic book of clients and we believe that working now with Conduity will help us to achieve our business goal,” he added.

Smarttech247 generated revenue of €4.8m in the year to the end of July 2020, and a pre-tax profit of €829,000. The financial year that has just ended will demonstrate “further substantial progress”, according to the firm’s management team.

Smarttech247 has a number of proprietary automated security products. Its customers include Cuisine de France owner Aryzta and the Royal College of Surgeons Ireland.

In June, Smarttech said it was awarded a multi-year contract to provide managed security services to a major advanced manufacturing company that employs more than 100,000 people.

The Cork firm has also been awarded a purchase order under that contract valued at €6m for cyber security services at plant level.

Smarttech247’s investors include UK-based RiverFort Global Opportunities, which earlier this year invested €1.4m in the Irish firm.

RiverFort said yesterday that the planned reverse takeover of Smarttech represents a valuation that is “significantly higher” than that at which it invested in the Irish company in May.