Well, there it was. I’ll have to investigate further what happened to the rest of it, once I get a chance amidst Admicom’s earnings day.
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The AI commented on the matter as follows.
The interpretation of the purchase price is based on the details of the announcement, especially regarding the fixed and variable purchase price. The following points are key:
- Total Purchase Price (Enterprise Value): The total purchase price has been agreed upon as 22.5 million euros. This includes both the fixed and variable components.
- Fixed Component (60%): The fixed price, which will be paid in cash and debt-free, is 60% of the total price, or approximately 13.5 million euros. This portion will be paid upon the closing of the transaction.
- Variable Component (40%): The remaining 40%, approximately 9 million euros, is a variable purchase price based on the performance of the business being sold in 2025 and 2026. This sum will be paid in two installments at the beginning of 2026 and 2027.
Can the purchase price exceed 22.5 million euros?
No. The 22.5 million euros mentioned in the announcement is the total purchase price, and it already accounts for both the fixed and variable components. However, the variable component may vary depending on the business’s performance, but it will not exceed this pre-agreed total price.
Important to note:
- The terms of the variable purchase price are not precisely described in the announcement, but generally, such terms are tied to the realization of revenue, profit, or other performance metrics.
- If the conditions for the variable price are not met, the purchase price may fall below 22.5 million.
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The purchase price has been communicated contrary to normal practice. It should be stated that the purchase price is 13.5M and an additional purchase price of 0-9M may be received over the next two years, if the targets set for the next two years in connection with the transaction are met. This means it is very possible that no additional purchase price will be paid. Such earn-out arrangements are almost always a source of disputes, the interpretation of which will then be argued over after two years. At the same time, it easily leads to the buyer being unable to integrate the business, because measuring the results of the sold business becomes impossible. The auditor’s duty is to approve only the 13.5M purchase price at this point.
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I guess this could be interpreted as a glimmer of hope.
Let’s see after the quiet period what the direction is.
Atte also mentioned earlier that investors have thrown in the towel, but let’s hope that after the quiet period, everyone humbly goes to pick up their own towel 
No need to think about divestments anymore, now it’s exciting to see what the direction is. Let’s wait and see what happens in February, hopefully good news.
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We will update our sum-of-the-parts calculation with the divestment of consulting in connection with the financial statements to be published on 12.2., when more information about the arrangement will also be available. Currently, our sum-of-the-parts indicates a share value of 1.1–1.6 euros per share, and the situation will not change significantly based on yesterday’s news.
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Regarding yesterday’s reflection on the variable part, I wrote this when I tried to inquire about the matter from the company’s side:
“Our understanding is that the performance criteria for the variable part have been set at a level where they are realistically achievable.”
So, initially, the entire sum is intended to be collected, and regarding that variable part, there have certainly been many negotiations about the criteria. From an accounting perspective, the sum then has to be discounted, etc., which makes the write-down still surprisingly large.
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I myself have been thinking about this split and the strategic actions and their objectives. I have come to the conclusion that it was known already during the demerger phase that the company would be sold at some point. Now that the consulting business was sold, the intention is to create a growing, profitable software company operating with a good gross margin, which will be sold at a good premium. So, Siilasmaa has always wanted to get rid of corporate cybersecurity and focus on consumer cybersecurity, and this is how it can still be done profitably, as long as WithSecure is now brought into a good state. Am I completely off track, or what are others’ thoughts?
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It probably depends on what buyers want (customers / expertise and technology / business), but from a sales perspective, F-Secure would somehow feel like a much clearer / neater package?
Of course, I don’t understand anything about M&A.
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Risto Siilasmaa leaves F-Secure’s board (10.1. 2025)
So maybe Withsecure (chairman of the board) is more interesting after all.. 
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I recommend listening to Siilasmaa’s interview on Karon Grilli starting from 34:20 - 38:25👇
I personally don’t consider the scenario you described above to be the most likely. Siilasmaa’s integrity is too high for this.
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Thanks for the interesting video. Hopefully, Withsecure gains momentum and takes off.
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Withsecure will be sold as soon as it’s made ready for sale, and Siilasmaa will keep F-secure. The history of the names already tells us which one can be divested more easily. It would be better if W (Withsecure) were sold, because in the Finnish stock market, with that growth and profitability, no reasonable market value can be achieved for the business. Sell it off with a small premium, and Siilasmaa can better focus again on one company important to him.
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Here are some thoughts on Withsecure and F-Secure. F-Secure is a more mature company, and I believe that’s why Siilasmaa is stepping down from the board. Board work can be delegated to others. F-Secure doesn’t cause as many headaches, but on the other hand, its value creation potential is also more limited, in my opinion. Withsecure, on the other hand, is in a less mature phase, which requires more attention but at the same time offers very significant value creation potential.
In the case of Withsecure, I believe value creation can be achieved in several ways. One way is to focus the company purely as a SaaS company by selling off non-core businesses. The recently completed sale of consulting services is, in my opinion, a very important step, even though the realized sale price was a slight disappointment. The company has also announced that Cloud Protection for Salesforce is under strategic review. I believe there is a lot of hidden value in this piece. In the Q3 report, its ARR was 10.2MEUR and it grew by 38%. Even if growth doesn’t continue at this pace, it’s difficult to value it at EV/S<1. What would be a suitable multiple is left for everyone to assess.
The best way to create value is, of course, to grow sales in the company’s most important part, the Elements Cloud business. Growth would improve profitability and, consequently, the company’s risk profile. If this succeeds, value should be created with leverage as valuation multiples improve. In the Q3 report, Elements Cloud ARR was 81.8MEUR and it grew by 11% from the previous year. At the investor days, the company explained what this consists of: Elements cloud software ARR grew by 16.2% (51.3->59.6MEUR) while Managed Services and Co-Security decreased slightly (22.5->22.2MEUR). This was apparently due to the loss of a large customer.
Of course, one would hope for better growth, but these figures are not as dismal as one might conclude from the share price development. Perhaps these growth figures have received little attention as consulting has not grown, thus lowering the overall company’s growth percentages?
The last and worst way to create value would be significant savings to improve profitability. I don’t believe in this, as a large savings program was completed about a year ago.
Finally, it is difficult to assess whether Siilasmaa is selling either company (F-Secure or Withsecure). If something like this were to happen, F-Secure would be the more likely target, in my opinion, precisely because of its development stage. Instead, I believe that Withsecure’s CPSF piece will be sold sooner or later, for example, to a private equity investor. This is unlikely to happen before the multiples are good.
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This caught my eye. It says a lot about the state of cybersecurity in DACH countries; in Finland, faxes haven’t been widely used for ages, and in Germany, health data is still sent via them even today, wow.
This is therefore an opportunity for WS to grow specifically in that region, while it continuously loses market share, e.g., in Finland. But how long can WS grow there, that’s the big question. At some point, Germany will also transition to more advanced cybersecurity solutions, just as has happened in Finland.
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Aten’s preview comments as WithSecure reports its Q4 results next week on Wednesday. 
Cloud-based products have continued their growth towards the end of the year, although the current pace is not entirely satisfactory. Thus, the outlook is expected to provide hopes for an acceleration in growth this year. WithSecure’s operational profitability has continued to improve as anticipated towards the end of the year, supported by software business growth and implemented cost savings. However, the write-down of consulting weighs on the reported figures, as a new owner was finally found for the business at the end of January. Overall, the divestment of consulting is, in our opinion, positive and sharpens WithSecure’s investment profile. The correction of the share’s low valuation would still require a strengthening growth outlook to support it.
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Oh wow! Nordnet seems to show that Nordea made trades of almost a million shares. What does that tell us?
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It could very well be, for example, a transfer of a stock portfolio from one fund to another.
Nordea is on both sides of the transaction.
It doesn’t tell anything other than a seller has been found for a buyer or vice versa. So, a rather large trade has been executed relative to normal volume, but in itself, it doesn’t tell whether someone initially wanted to sell (and a buyer was sought for them) or someone wanted to buy (and a seller was sought for them). Usually, these trades are executed in what’s called midi.
@Pika-Sissi when a trade is executed, the counterparty is always the same. Nordea has just found a buyer for the seller, or vice versa. Of course, that doesn’t rule out the option you mentioned.
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Investment Fund Danske Invest Finland Equity has sold all 495,152 shares, and S-Bank Fenno Equity Investment Fund has also sold all 428,116 shares. Both have been in a selling position for a longer time and now seem to have fully exited. This is concluded from the number of shares. More interesting is who bought them.
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Key events in October–December 2024 (“the last quarter”)
- Annual Recurring Revenue (ARR)2 for cloud-based Elements products and services1 grew by 6% to EUR 83.3 million (EUR 78.4 million)
- Annual Recurring Revenue for cloud-based Elements products and services grew by 2% compared to the previous quarter
- Customer retention for cloud-based Elements products and services was 99%
- Revenue from cloud-based Elements products and services grew by 9% to EUR 21.5 million (EUR 19.7 million)
- ARR for Cloud Protection for Salesforce (CPSF) grew by 52% to EUR 12.8 million (EUR 8.4 million)
- Revenue from cybersecurity consulting decreased by 15% to EUR 8.6 million (EUR 10.2 million). The sales agreement for cybersecurity consulting was signed in January 2025. This business will be reported as discontinued operations. A goodwill impairment of EUR 13 million was recorded in the last quarter in anticipation of the sale’s impact.
- WithSecure’s adjusted EBITDA (total of continuing and discontinued operations) was EUR 2.4 million (EUR 0.2 million)
- Cash flow from operations in the last quarter was EUR 7.7 million (EUR 2.7 million)
Outlook for 2025
Annual Recurring Revenue (ARR) for cloud-based Elements products and services is expected to grow by 10-20% from the previous year.
At the end of 2024, the ARR for cloud-based Elements products and services was EUR 83.3 million.
The adjusted EBITDA for the Elements Company segment is expected to be 3-7% of revenue.
Annual Recurring Revenue (ARR) for Cloud Protection for Salesforce (CPSF) is expected to grow by 20-35% from the previous year.
At the end of 2024, the CPSF ARR was EUR 12.8 million.
The cybersecurity consulting business will be divested during 2025. Going forward, separate guidance will be provided for the Elements Company and CPSF segments. Both are recurring, subscription-based businesses, which forms the basis for the new guidance.
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