Shares In pioneering AI-based cybersecurity firm DarkTrace (GB:DARK) slumped by almost a third after the U.S. private equity firm Thoma Bravo said it would not proceed with a takeover bid.
The British-based cybersecurity firm Darktrace also announced that it was to restate its accounts after noticing that $3.8 million of revenue in 2022 should have been accounted in 2021.
The change has not affected the company’s revenues or forecasts.
Why is Darktrace stock falling?
Thoma Bravo did not offer a reason for pulling out, but speculation abounded.
Analysts at Stifel said: “If something were discovered by Thoma Bravo or the company it hired to conduct the due diligence, it will eventually come out.”
“Another reason why the talks may have broken down could be related to Mike Lynch and his wife’s 12 per cent stake in the company, as the former talked to the press in August and appeared clearly against the takeover by a US PE fund.”
Businessman Mike Lynch has resigned as an advisor to Darktrace, but faces extradition to the U.S. on charges relating to HP’s takeover of Autonomy.
CEO Poppy Gustafsson said, “Being listed on the London Stock Exchange is exactly where we want to be right now.”
Thoma Bravo has been on an acquisition binge in the technology industry for quite some time now. The company acquired Ping Identity, a software company that provides intelligent identity solutions, for $2.8 billion.
Darktrace’s stock has been volatile in recent months; the stock gained 44% after dipping below the mark of 300p in July.
What is Darktrace in cyber security?
Founded in 2013, Darktrace is a cyber security company focused on innovative AI tech. It is among the highly popular areas in tech due to high cyber security demand due to hacking threats after the Russia-Ukraine war.
The company is a leader in the AI-based cyber security space and provides solutions for threats such as ransomware, cloud attacks, SaaS attacks, and more.
It has more than 7,000 customers around the world, with some big names including Coca-Cola, Jimmy Choo, Anheuser-Busch, McLaren, and more.
Is Darktrace stock a buy?
According to TipRanks’ analyst rating consensus, Darktrace stock has a Moderate Buy rating. The rating is based on three Buy and one Sell ratings from analysts.
The average price target is 629.5p, which shows a change of 23.1% on the current price level. The analyst price targets range from a low of 320p to a high of 998p.
Is Darktrace any good?
Despite positive numbers for revenue and profits, investors are wary of DarkTrace after Thoma Bravo’s withdrawal.
