archTIS has announced that binding commitments have been received from investors to raise gross proceeds of approximately $8.4 million.
The company will use the money to commercialise new products, including DataKloak, to protect Big Data from unauthorised access.
archTIS has also agreed to acquire global information protection business Nucleus Cyber for a total potential consideration of up to A$9.75m in archTIS shares.
"This is a transformational acquisition that leverages our core capabilities, expands our offering into the Microsoft product suite and creates new sales and distribution channels globally," the company said.
"The newly expanded product offering creates increased revenue diversity, scale, and a platform for accelerated growth that is expected to generate cross-selling opportunities between the client bases."
Nucleus Cyber recorded $819,000 annual recurring revenue in FY20 at over 130% year on year growth from its high-margin, annual subscription-based software platform across a wide range of sectors including government and defence, financial services, healthcare, pharmaceuticals, energy and manufacturing.
A recent co-sell agreement means Microsoft will actively promote and sell Nucleus Cyber Protect product throughout the Microsoft field sales and channel resellers.
The acquisition of Nucleus Cyber offers unique opportunities for growth across Microsoft’s Teams, Office 365, SharePoint and Exchange products globally both on premise and in the cloud. The funding raised will help accelerate these opportunities.
Completion of the transaction remains subject to finalisation of standard documentation and shareholder approval and is expected before the end of calendar year 2020.
archTIS secured a landmark $4.2m contract with Department of Defence during the third quarter. It also has an Information Security Services contract with KPMG for an Australian Commonwealth National Security Agency to the value of $400,000.
“archTIS appreciates the continued support from shareholders. We were very pleased to see such strong demand from new investors and long-term holders, and are delighted to welcome additional quality institutional investors to the register," Daniel Lai, archTIS CEO, said. "This capital will further strengthen the archTIS balance sheet and provides the company with the runway it requires to fully leverage the transformative acquisition of Nucleus Cyber.”