One year following the acquisition of Arago, WiseKey sold its 51% stake in the German company back to a German consortium of investors. WiseKey obtained EUR 25.5 million in the sale, realising more than 5x return on initial cash investment. The two companies have formed a strategic partnership to leverage their technologies.
In August 2020, WISeKey and German-based Arago started a combined journey to conquer the application of AI in the IoT space, with the former holding a 51% stake. After careful consideration, due to different business approaches and go to market strategies for WISeKey’s and Arago’s Automation platform, a decision was made to separate the companies while keeping the strategic partnership and technology integration WISeAI intact.
WISeKey is a leading global cybersecurity company currently deploying large scale digital identity ecosystems for people and objects using Blockchain, AI and IoT, respecting the Human as the Fulcrum of the Internet. WISeKey IoT has an install base of over 1.6 billion microchips in virtually all IoT sectors. Arago on the other hand is a German technology leader providing the benefits of Artificial Intelligence to enterprise customers globally through Knowledge Automation.
The Swiss cybersecurity company is selling its 51% stake in Arago back to a German consortium of investors led by Arago’s founder through his investment company, OGARA GmbH, for EUR 25.5 million, which is over five times the initial investment made by WISeKey to acquire its 51% stake.
Since its acquisition, WISeKey has made significant investments to explore the integration of Arago AI with WISeKey’s Trust and IoT applications. When taking into account these investments, the net cash proceeds from the sale to WISeKey is EUR 17 million.
The continuing partnership between WISeKey and Arago will ensure that both companies can use each other’s technology to add to their businesses. For WISeKey, this means having the license to use HIRO AI as part of the IoT solutions offered to its customer base. WISeKey’s certification ability and trust platform will make Arago's platform more secure and allow the application of enterprise AI with fewer pre-requirements of data. Both companies will continue working together on the increasing adoption of AI and IoT convergence as one of the primary factors driving the growth of the IoT market.
After the sale, all WISeKey options given to Hans-Christian Boos to exchange his remaining 49% in Arago representing 12.3 million WISeKey Class B shares will be cancelled and returned WISeKey as part of the deal thus reducing substantially the dilution for WISeKey shareholders. Hans-Christian Boos will also step down as a board member of WISeKey to be replaced by an industry expert focused on WISeKey’s IoT Cybersecurity solutions.
(Press release)
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