TransUnion (NYSE: TRU) has signed a definitive agreement to acquire Sontiq, a leader in digital identity protection and security. Sontiq provides solutions to empower consumers and businesses to proactively protect against identity theft and cyber threats, including identity monitoring, restoration, and response products and services. Sontiq’s focus on identity security complements TransUnion’s digital identity assets and solutions, and the combined company will offer a comprehensive set of omnichannel solutions to make trust possible for consumers and businesses.
Headquartered in Nottingham, Md., Sontiq is expected to generate approximately $85 million of revenue in 2021, and grow double-digits in the future driven by significant revenue synergies. Sontiq operates with an attractive Adjusted EBITDA margin of approximately 40% that is expected to increase as a result of high-margin revenue growth. TransUnion will acquire Sontiq for approximately 19 times expected FY2021 Adjusted EBITDA and expects the acquisition to be neutral to Adjusted Diluted EPS in 2022 and accretive thereafter.
“As online commerce rapidly accelerates, TransUnion has calibrated its business to address consumer and customer challenges relating to identity,” said Chris Cartwright, President and CEO of TransUnion. “Augmenting our Consumer Interactive business with Sontiq’s identity and cyber protection services will advance our work to enable consumers and businesses to transact with greater certainty.”
Acquisitions like TLO, iovation, TruOptik and others, combined with TransUnion’s historic strengths as a credit bureau, have built a strong foundation, enabling the company to resolve identity across a wide range of use cases.
“TransUnion is committed to empowering consumers to shape their financial futures. With Sontiq, we will ensure that consumers and businesses have a comprehensive set of tools to protect the financial profile they have built,” said Steve Chaouki, President of U.S. Markets and Consumer Interactive at TransUnion. “We will make these identity protection tools accessible to consumers where they need them, by leveraging our strategic partnerships across all of the markets we serve.”
Sontiq’s Intelligent Identity Security platform serves as the foundation of its identity theft and cyber threat protection solutions for consumers. Sontiq delivers these solutions directly to consumers and through partners and customers as well via its product brands: IdentityForce, Cyberscout and EZShield. Sontiq’s identity security monitoring products — which already utilize TransUnion’s credit data — are highly complementary to TransUnion’s capabilities, and will result in a comprehensive set of offerings that will significantly increase growth opportunities for the combined business.
“We are excited to enter into the next phase of Sontiq’s growth with TransUnion,” said Sontiq President and CEO Brian J. Longe. “Together, we share a commitment to innovation and helping consumers and businesses protect their financial profiles and everything they have built. Not only will our combined products and solutions benefit our customers and partners, but the customer-first focus demonstrated by both organizations is impressive and will create long-term success for all.”
The transaction is expected to close in Q4 2021 subject to the satisfaction of customary closing conditions and regulatory approvals.