OpSec — SPAC Merger (April 2023)
46 slides from OpSec's SPAC merger presentation, Apr 26, 2023
Slide 1: OpSec Group Investor Presentation April 2023
Filed by OpSec Holdings Pursuant to Rule 425 under the Securities Act of 1933 and deemed filed pursuant to Rule 14a-12 under the Securities Exchange Act of 1934 Subject Company: Investcorp Europe Acquisitions Corp I Commission File No.: 001-41161 Date: April 26, 2023 OPSEC GROUP BRAND READY. INVESTO
Slide 2: Disclaimer (1/5)
DISCLAIMER (1/5) This presentation (together with oral statements made in connection herewith, this “Presentation”) is for informational purposes only to assist interested parties in making their own evaluation with respect to the proposed business combination (the “Business Combination”) between In
Slide 3: Disclaimer (2/5)
DISCLAIMER (2/5) For example, statements concerning the following include forward-looking statements: (i) the expected timing and likelihood of completion of the proposed Business Combination, including the risk that the proposed Business Combination may not close due to one or more closing conditio
Slide 4: Disclaimer (3/5)
DISCLAIMER (3/5) The distribution of this Presentation may also be restricted by law and persons into whose possession this Presentation comes should inform themselves about and observe any such restrictions. The recipient acknowledges that it is (a) aware that the United States securities laws proh
Slide 5: Disclaimer (4/5)
DISCLAIMER (4/5) OpSec defines EBITDA as earnings before interest, tax, depreciation, amortization, share based payments, and exceptional items. EBITDA is used as a supplemental financial measure by OpSec’s management and external users of financial statements, such as lenders, to assess OpSec's ope
Slide 6: Disclaimer (5/5)
DISCLAIMER (5/5) Additional Information In connection with the proposed Business Combination, Pubco intends to file with the SEC a registration statement on Form F-4 containing a preliminary proxy statement/prospectus of Pubco, and after the registration statement is declared effective, Investcorp w
Slide 7: Today's Presenters
TODAY’S PRESENTERS OPSEC GROUP DR SELVA SELVARATNAM BEV DEW CHIEF EXECUTIVE OFFICER CHIEF FINANCIAL OFFICER Held several C-level positions in the Software and More than 20 years of financial experience, including Security Solutions industry over 35 years as CFO of Kier, a UK listed business Experien
Slide 8: Overview of Transaction
OVERVIEW OF TRANSACTION Investcorp Europe Acquisition Corp I (NASDAQ: IVCB) to merge with OpSec Group (1) Valuation Pro forma enterprise value of $426 million (10.7x FY’24E March YE EBITDA of $40 million ) (2) $50 million PIPE fully backstopped by Investcorp Capital Sources Up to $199 million of pro
Slide 9: Transaction Summary at Minimum Cash
TRANSACTION SUMMARY AT MINIMUM CASH Illustrative Transaction Structure Illustrative Pro forma Enterprise Value ▪ OpSec, a global provider in IP/brand optimization, monetization, and protection, plans to enter into a Pro Forma Shares Outstanding 32.4 definitive business combination with Investcorp Eu
Slide 10: Highlights for Future Investment
HIGHLIGHTS FOR FUTURE INVESTMENT OpSec represents a compelling investment opportunity… A leading global provider in IP/brand optimization, monetization, and protection with a complete end-to-end offering 1 Large, fast-growing addressable markets, benefitting from a number of macro trends driving inc
Slide 11: Introduction to OpSec
1 INTRODUCTION TO OPSEC OpSec works with some of the world’s leading brands and is truly global… customers worldwide (1) (1) Denmark, UK Group revenues ~2/3 of the Interbrand 100 Sweden, $218m 5,000+ Online, R&D, in FY’23 Best Global Brands Design, IP Norway Management IP Management Manufacturing ke
Slide 12: Why OpSec
1 WHY OPSEC OpSec has become a leader in building and securing brand identities, assets, and returns for some of the world’s most valuable brands… OPTIMIZING BRANDS & IP Registering and renewing IP (trademarks, patents) Product Assets Optimizing and managing IP portfolios Enforcing IP rights and sup
Slide 13: OpSec Brought to Life
1 OPSEC BROUGHT TO LIFE OpSec products, services, and solutions can be found at the heart of some of the world’s most valuable and recognizable brands and intellectual property… OPTIMIZING BRANDS & IP MONETIZING BRANDS & IP PROTECTING BRANDS & IP PROTECTING BRANDS & IP Managing and Protecting IP Lic
Slide 14: The OpSec Difference
1 THE OPSEC DIFFERENCE OpSec works with around two thirds of the world’s most respected and valuable brands, including 19 of the top 25 most valuable… UNIQUE INNOVATION optical/digital developments to counter new threats and offer new possibilities CUSTOMER COLLABORATION bringing innovation, design,
Slide 15: Evolution of OpSec
1 EVOLUTION OF OPSEC OpSec has evolved into an integrated end-to-end IP and brand protection business with several adjacent market opportunities – plus bolt-on capability acquisitions… 2006 - 2020 2020 - 2022 2023 2024 - 2025 REVENUE PHYSICAL BRAND 360° BRAND 360° IP VALUE BRAND (1) (2) (3) (4) ~$88
Slide 16: Why OpSec? The Importance of Intangibles
2 WHY OPSEC? THE IMPORTANCE OF INTANGIBLES An increasing amount of value is now accounted for by intangible brand value – formed from intellectual property itself plus authenticity and trust… 1145% 3.4m 91% of consumers growth in intangible assets patents filed globally in 2021, claim authenticity a
Slide 17: Fundamentals of the Market
2 FUNDAMENTALS OF THE MARKET However, creating, monetizing and protecting IP is challenging and – in the face of sophisticated expectations and threats – is becoming more technology centric… $225-600bn cost of intellectual property theft Yahoo, DHL, Microsoft, 72% Phishing at Verizon Google, LinkedI
Slide 18: Strong Macro Growth Drivers
2 STRONG MACRO GROWTH DRIVERS Several mega trends are driving growth in the principal markets that OpSec is exposed to… MEGA IP MANAGEMENT DIGITAL (1) SOFTWARE $7.0bn BRANDS EVERYTHING 17.3% $18.5bn market value 2022 CAGR TO 2027 market value 2027 IP LEGAL (2) SERVICES $9.5bn 8.9% $26.5bn THE ESG ME
Slide 19: OpSec Is a Technology Enabled Business
3 OPSEC IS A TECHNOLOGY ENABLED BUSINESS OpSec addresses brand challenges with a proprietary portfolio of physical and digital capabilities… Consumer & Industrial Regulated & Security Sports & Apparel Media & Technology IP & BRAND MANAGEMENT BRAND OPERATIONS IP & BRAND PROTECTION Registration Licens
Slide 20: Digital and Systems Capabilities
3 DIGITAL AND SYSTEMS CAPABILITIES OpSec draws upon a wide array of digital technologies and techniques across IP and brand… CAPABILITIES CLEANSEARCH NFT INFRINGEMENT LICENSING SOLUTION ▪ Machine Learning (AI) Identifies and delists pirated search Detects and removes NFTs that End-to-end solution fo
Slide 21: Optical and Material Science Capabilities
3 OPTICAL AND MATERIAL SCIENCE CAPABILITIES OpSec brings together a diverse range of technologies in optical and materials science… CAPABILITIES PRECISION KEYCODE INSPIRE ▪ Advanced Micro Lithography Intricate demetalization of security First security label to feature Secure digital print for flexib
Slide 22: Key Segments and Competitors
4 KEY SEGMENTS AND COMPETITORS The management and protection of IP and brands covers a broad range of markets – OpSec identifies six principal business lines that it serves… (1) REVENUE PROFILE MARKET POSITION DESCRIPTION COMPETITORS Management of IP Portfolios Clarivate • Questel • RWS • AWA Tech-e
Slide 23: Licensing Management + Product Traceability Case Studies
4 LICENSING MANAGEMENT + PRODUCT TRACEABILITY CASE STUDIES OpSec solutions uniquely combine optical/materials capabilities and digital platforms… SPORTS SPORTS LICENSING MANAGEMENT SOLUTION PRODUCT TRACEABILITY SOLUTION APPAREL LICENSOR OpSec combines authentication, consumer engagement and licensin
Slide 24: IP Registration + Digital Media Protection Case Studies
4 IP REGISTRATION + DIGITAL MEDIA PROTECTION CASE STUDIES OpSec solutions manage and protect intellectual property assets, including digital content… CROSS VIDEO ON IP MANAGEMENT SOLUTION DIGITAL MEDIA PROTECTION SOLUTION INDUSTRY DEMAND OpSec provides full lifecycle management of IP assets and iden
Slide 25: Experienced Management Team
5 EXPERIENCED MANAGEMENT TEAM OpSec is led by a team that was largely established following the acquisition of MarkMonitor… DR SELVA SELVARATNAM CEO BEV DEW CFO OpSec is managed by an Executive Leadership More than 35 years experience in technology Over 20 years in international development, busines
Slide 26: Global Presence and Capability
5 GLOBAL PRESENCE AND CAPABILITY OpSec supports its global customers with an international operational footprint… Diversified supply Global reach allows SCANDINAVIA chain mitigates proximity to major Denmark, Sweden, Norway disruption risk UNITED KINGDOM manufacturers (1) UNITED STATES (E) ~1,300 st
Slide 27: Growth Opportunities and Strategy
6 GROWTH OPPORTUNITIES AND STRATEGY OpSec is positioned to pursue multiple growth strategies through a combination of target acquisitions and upscaling organically… Increased number of counterfeit Extension of core brand protection BOTH products sold online and offline proposition (e.g., domain, tra
Slide 28: Organic Growth Traction
6 ORGANIC GROWTH TRACTION Improved integration of offerings and restructuring of sales team drive organic growth… CROSS-SELL AND UPSELL TO NEW CUSTOMER WINS EXISTING CUSTOMERS CUSTOMER PRODUCT CUSTOMER UPLIFT INTEGRATION OF OFFERINGS Major US Piracy and Global Sports Particular focus on cross produc
Slide 29: Acquisition Environment and Targets
6 ACQUISITION ENVIRONMENT AND TARGETS OpSec is actively developing a pipeline of acquisition targets across its target landscape… Managing and protecting Extend core Domain Management QUALIFIED TARGETS brand domain identities proposition Facilitating access to the Extend core IDENTIFIED TARGET Case
Slide 30: Compelling IP and Brand Services for Marque Customers
6 COMPELLING IP AND BRAND SERVICES FOR MARQUE CUSTOMERS OpSec is bringing together the full lifecycle for optimizing, monetizing, and protecting brands and IP for the world’s leading brand and content owners… Working with around two thirds of the most valuable brands Product Assets Identity Content
Slide 31: Key Performance Indicators Behind the Business Plan
7 KEY PERFORMANCE INDICATORS BEHIND THE BUSINESS PLAN $218m 95% 5,000+ (3) (1) (1) FY23 reoccurring Group customers worldwide for FY23 Group revenues (1) revenue the Group 71% 90% (1) (4) Group long-term cash FY23 net retention rate in (2) (5) conversion OpSec Solutions Source: Company information N
Slide 32: Strong Growth and High Reoccurring Revenues
7 STRONG GROWTH AND HIGH REOCURRING REVENUES (1) 2021–2025 PRO FORMA REVENUE BREAKDOWN ($M) KEY CONSIDERATIONS Fiscal year end 31 March OpSec Solutions: • 2021-23 CAGR of 3% mainly on the back of adverse trading conditions due to COVID and restructuring of sales team in technology-enabled services ‒
Slide 33: Growing Profitability and Cash Generation
7 GROWING PROFITABILITY AND CASH GENERATION (1)(2) 2021–2025 PRO FORMA EBITDA BREAKDOWN ($M) KEY CONSIDERATIONS Fiscal year end 31 March CAGR 2023-25: OpSec Solutions: 18% CAGR • Margin up from 15% in FY21A to 19% in 47 2021-23 2023-25 FY25E due to greater proportion of digital CAGR 2021-23: solutio
Slide 34: Breakdown of Historical and Projected Financials
7 BREAKDOWN OF HISTORICAL AND PROJECTED FINANCIALS Pro Forma for Acquisition of Zacco Historical Plan CAGR $ In million, FYE 31 March FY2021A FY2022A FY2023E FY2024E FY2025E 2021-23 2023-25 OpSec Solutions 112 126 120 134 148 3% 11% Growth % -- 12% (5%) 12% 10% -- -- Zacco Solutions 89 92 98 113 127
Slide 35: Transaction Considerations
TRANSACTION CONSIDERATIONS Proprietary and Confidential © OpSec Security, Inc | 35
Slide 36: Peer Selection
V PEER SELECTION COMPS SET COMMENTARY RELEVANCE p ID / Anti-fraud software and services that resemble OpSec’s online segment ID / SECURITY p Similar proposition in terms of providing protection and SOLUTIONS enforcement solutions q Mostly focusing on cyber security p Peers reflecting digital side of
Slide 37: Operational Benchmarking
V OPERATIONAL BENCHMARKING 2023 – 2025 REVENUE CAGR (%) ID / SECURITY SOLUTIONS MEDIAN: 7.4% TECH-ENABLED OUTSOURCING: 9.8% PHYSICAL ID / SECURITY: 3.6% 12.3% 11.7% 11.6% 8.0% 7.8% 7.8% 6.9% 6.4% (1) 4.2% 3.6% 3.2% 2.9% 2024 EBITDA MARGIN (%) ID / SECURITY SOLUTIONS MEDIAN: 29.6% TECH-ENABLED OUTSOU
Slide 38: Valuation Benchmarking
V VALUATION BENCHMARKING FV / EBITDA 2024E ID / SECURITY SOLUTIONS MEDIAN: 14.8x TECH-ENABLED OUTSOURCING: 11.8x PHYSICAL ID / SECURITY: 12.4x 16.3x 16.4x 15.8x 13.7x 13.0x 12.8x 12.4x (1) 10.7x 10.1x 10.5x 9.9x 9.7x FV / EBITDA 2025E ID / SECURITY SOLUTIONS MEDIAN: 13.1x TECH-ENABLED OUTSOURCING: 1
Slide 39: Appendix
APPENDIX Proprietary and Confidential © OpSec Security, Inc | 39
Slide 40: Business Model of OpSec Solutions and Key Revenue Drivers
A BUSINESS MODEL OF OPSEC SOLUTIONS AND KEY REVENUE DRIVERS Brand Protection Technology Materials Anti-Piracy and Anti-Fraud Helping clients across various industries protect their IP from Helping payment cards companies prevent unauthorised card Helping clients prevent unauthorised use of their bra
Slide 41: Business Model of Zacco and Key Revenue Drivers
A BUSINESS MODEL OF ZACCO AND KEY REVENUE DRIVERS Zacco is an IP services firm with a deep presence in the Nordic markets (especially in Sweden and Denmark) supporting clients across the whole intellectual property lifecycle IP Consulting IP Services Digital Services • Design, application, filing, •
Slide 42: EBITDA Reconciliation
A EBITDA RECONCILIATION (1) (2) Historical Historical In million $ , FYE 31 March FY2021A FY2022A In DKK million, FYE 31 December FY2021A FY2022A Operating Profit after JV (1) 4 Operating Profit 20 45 (3) (+) Goodwill 6 8 (+) Platform costs 17 10 (+) Depreciation 7 6 (+) Exceptional costs 3 5 (+) Sh
Slide 43: Summary Risk Factors (1/4)
SUMMARY RISK FACTORS (1/4) The list below of risk factors has been prepared as part of the Business Combination. The risks presented below are certain of the general risks related to the business of the OpSec, Investcorp and the combined company, and such list is not exhaustive. The list below is qu
Slide 44: Summary Risk Factors (2/4)
SUMMARY RISK FACTORS (2/4) Risk Related to OpSec's Business (cont’d) • Part of OpSec’s and Zacco’s revenues are seasonal by nature of the IP solutions business with historical performance indicating the fourth and third quarters are OpSec’s and Zacco’s strongest, respectively (for example, one-year
Slide 45: Summary Risk Factors (3/4)
SUMMARY RISK FACTORS (3/4) Risk Related to OpSec's Business (cont’d) • OpSec’s failure to comply with the anti-corruption laws of the United States and various international jurisdictions could negatively impact its reputation and results of operations. • OpSec is subject to laws and regulations wor
Slide 46: Summary Risk Factors (4/4)
SUMMARY RISK FACTORS (4/4) Risks Related to the Business Combination • The process of taking a company public by means of a business combination with a special purpose acquisition company is diffe rent from taking a company public through an underwritten offering and may create risks for unaffiliate