French security giant Thales has announced it will sell off its hardware security arm nCipher Security due to competition regulations surrounding its buyout of Dutch firm Gemalto.
Thales will sell the security unit to US firm Entrust Datacard.
Thales snapped up the Netherlands-based digital security firm for €4.8bn in 2017.
However, since then, EU antitrust agencies, including the European Commission, specified that Thales had to sell off part of its HSM (hardwear security module) portfolio "in order to ensure a strongly competitive market for GP HSM solutions and to finalise the acquisition of Gemalto".
nCiper Security is a HSM business based in the UK, which Thales bought up in 2008 for $100m.
However, it had been operating as a separate standalone business within Thales since January 2019, in preparation for its sale to a third party.
Minnesota-based Entrust Datacard is a public key infrastructure (PKI) solutions and services firm.
Its CEO Todd Wilkinson said that strengthening its HSM portfolio would better enable the business' cryptography capabilities.
Thales' EVP of strategy, research and technology Philippe Keryer said that the divestment is expected to be completed by the end of March 2019.
"We are convinced that nCipher Security will strongly leverage the expertise of Entrust Datacard, an organisation focused on their competencies in the development of safe and secure access to information, applications and networks as well as its global presence specifically in Europe and in North America," he said.
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