International. Cognyte confirmed a definitive agreement to sell its situational intelligence solutions, which are part of Cognyte's Threat Intelligence Analytics offering, to the Volaris Group, for $47.5 million plus a performance-based profit, if and to the extent earned.
The transaction is expected to close in Cognyte's fourth quarter, subject to customary closing conditions, including obtaining regulatory approvals.
"Cognyte is addressing many security use cases with investigative analytics software, including Threat Intelligence Analytics. The portion of our Threat Intelligence Analytics offering that we are divesting focuses on physical security implementations that we refer to on our website as Situational Intelligence Solutions, including the Symphia brand. Our strategy is to continue to address a broad set of security use cases that require sophisticated investigative analysis software. Given this year's overall environment, we decided to increase our focus on fewer use cases to accelerate growth and improve margins, and we believe we will benefit from sharpening our focus," said Elad Sharon, CEO of Cognyte.
Divested assets
For the fiscal year ended January 31, 2022, excluding assets divested in all periods, the brand's revenue would have been $439.5 million, representing year-over-year growth of 9.9%. In the first half of the current fiscal year, divested assets accounted for about 10% of its total revenues. Divested assets include products and intellectual property, customer and employee contracts.
Approximately 10% of Cognyte's employees are expected to transfer to the business in R+D, Sales and Marketing, Operations and Services and G&A.
Sharon added, "We believe Volaris will provide a great home for our customers, partners and employees who will be transferred as part of the divestment."
"We are excited about the long-term opportunity of Cognyte's situational intelligence solutions and look forward to welcoming transferred employees and customers as part of our growing Volaris community," said Carl Bruce, group leader at Volaris Group.
