CynergisTek, Inc. Sells Managed Print Services Business to Vereco, LLC for $30 Million
20 März 2019 - 9:15PM
Business Wire
Deal Allows CynergisTek to Become Pure Play
Cybersecurity Company
CynergisTek, Inc., (NYSE AMERICAN: CTEK), a leader in
healthcare cybersecurity, privacy, and compliance, today announced
that it has closed a transaction to sell the assets used in its
Managed Print Services (MPS) business division for $30 million to
Vereco, LLC, a leading independent provider of healthcare document
services. CynergisTek management believes that this transaction
will enable CynergisTek to prioritize its core cybersecurity and
privacy services.
Under the asset sale agreement, all operations and assets of
CynergisTek’s MPS business division were transferred to Vereco.
CynergisTek will continue to operate its business division of
cybersecurity, privacy, and compliance management consulting.
Subject to the terms and conditions of the agreement, the total
consideration to CynergisTek is $30 million, of which $1.5 million
is subject to future sales activity of the MPS business.
CynergisTek’s use of the proceeds will include paying down a
majority of its existing debt, which will allow more flexibility to
grow the cybersecurity and privacy business. CynergisTek and Vereco
also entered into a strategic relationship that will allow
CynergisTek to provide cybersecurity assessments and managed
services to Vereco’s current and future clients, and also allow
Vereco to provide managed print services to current and future
clients of CynergisTek.
CynergisTek anticipates that this transaction will allow
CynergisTek to strengthen its balance sheet, allowing it to focus
on expanding its cybersecurity and privacy services and product
offerings, and enabling it to launch these services into other
industries. Management believes that the transaction also opens up
potential opportunities for mergers and acquisitions that would
take advantage of the growing demand for cybersecurity services in
the marketplace.
“We believe this sale will allow CynergisTek to more effectively
drive towards our strategic focus of growth in our cybersecurity
and privacy business, improve our financial condition through the
reduction of debt and increase our agility as a company overall,”
said Mac McMillan, CEO of CynergisTek. “At the same time, we are
entrusting our managed print customers to a high-quality leading
healthcare document services business and will be working to ensure
a quick and smooth transition for all customers.”
“Our acquisition of CynergisTek’s MPS business is a win for
all,” said Vereco CEO Joe Flynn. “CynergisTek is able to focus on
its award-winning cybersecurity business, and we’re able to extend
the reach and value of our distinctive approach to healthcare
document services. We’re excited by the prospect of bringing the
benefits of our enhanced organization to our current and future
clients.”
More information about the transaction will be available in a
Current Report on Form 8-K, which will be filed within four
business days of the closing of the transaction, as well as on
CynergisTek's Fourth Quarter and Full Year 2018 earnings call, to
be held on March 28, 2019.
About CynergisTek, Inc.
CynergisTek is a top-ranked cybersecurity, privacy, and
compliance management consulting firm dedicated to serving the
healthcare industry. CynergisTek offers specialized services and
solutions to help organizations achieve privacy, security, and
compliance goals. Since 2004, the company has served as a partner
to hundreds of healthcare organizations and is dedicated to
supporting and educating the industry by contributing to relevant
industry associations. The company has been named in numerous
research reports as one of the top firms that provider
organizations turn to for privacy and security and won the 2017
Best in KLAS award for Cyber Security Advisory Services.
Forward-Looking Statements
This release contains certain forward-looking statements
relating to the business of CynergisTek that can be identified by
the use of forward-looking terminology such as “believes,”
“expects,” “anticipates,” “may” or similar expressions. Such
forward-looking statements involve known and unknown risks and
uncertainties, including uncertainties relating to product/service
development, long and uncertain sales cycles, the ability to obtain
or maintain patent or other proprietary intellectual property
protection, market acceptance, future capital requirements,
competition from other providers, the ability of our vendors to
continue supplying the company with equipment, parts, supplies and
services at comparable terms and prices and other factors that may
cause actual results to be materially different from those
described herein as anticipated, believed, estimated or expected.
Certain of these risks and uncertainties are or will be described
in greater detail in our Form 10-K and Form 10-Q filings with the
Securities and Exchange Commission, which are available at
http://www.sec.gov. CynergisTek is under no obligation (and
expressly disclaims any such obligation) to update or alter its
forward-looking statements whether as a result of new information,
future events or otherwise.
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version on businesswire.com: https://www.businesswire.com/news/home/20190320005776/en/
Investor Relations Contact:CynergisTek, Inc.Bryan
Flynn(512) 402-8550 x8InvestorRelations@cynergistek.com
Media Contact:Aria MarketingDanielle Johns(617) 332-9999
x241djohns@ariamarketing.com
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