NCC sells Fox Crypto to Swedish CR Group

NCC, the English parent company of Fox-IT, announces the sale of the cryptographic division of the Hague-based cybersecurity firm for seventy million euros. This Fox Crypto is being sold to CR Group Nordic for seventy million euros. This Swedish security company offers digital solutions for the protection of classified information to military organizations and other governmental bodies within the European Union and NATO.

NCC Group intends to focus solely on the growth of its cybersecurity services, which Fox-IT partly provides to customers in the Benelux and across the European continent. These services include managed security services, digital forensic investigations, and incident response capabilities.

European Union

It is unclear whether the decision to sell was influenced by the fact that Great Britain is no longer a member of the European Union and Fox Crypto, like its new owner CR Group, primarily serves governmental bodies within the EU with its encryption solutions. The Stockholm-based company was previously known as C-Resiliens and includes the division Tutus Data, a specialist in protecting communication of state secrets.

Fox Crypto was founded in 1999 and came into the hands of the British NCC in 2015 as part of the acquisition of the Fox IT Group. The Delft-based company, which serves the Dutch armed forces among others, employs 144 people who plan to stay with the company, according to CR Group. The revenue, with strong profitability, increased by 53.8 percent to approximately 21 million euros in the twelve months leading up to May 2024.

Growing demand

In the recent past, NCC Group has been critical of Fox-IT’s performance; the close ties with governmental bodies yielded too little, and the Delft-based company needed to operate more commercially. A sale of the cryptographic division was already under consideration. Now that this ‘exciting’ division has been definitively divested, Fox-IT will continue as a conventional IT security company.

CR Group (225 employees) considers the acquisition of Fox Crypto an important strengthening of its position in the growing market for advanced cybersecurity and encryption solutions. The demand is rapidly increasing within the most sensitive operations of both the civil and defense-related sectors. According to CEO Björn Weigel, this is due to increased cyber threat levels, the war in Ukraine, increased NATO resources, national defense initiatives, and a growing demand for European autonomy and resilience in cybersecurity.

The acquisition, supported by investor Formica Capital, is expected to be completed in the fourth quarter. After the acquisition, CR Group’s revenue will amount to around 52 million euros.

Source: Rik Sander for Computable.nl