Security Breach Puts Altegrity’s Integrity And Liquidity On The Line
Kate Marino reports:
Hackers have claimed some high-profile corporate victims over the last year, with household names like Target and Home Depot typically reaping the lion’s share of media attention. Cyber attacks represent a growing threat to the business world, and their fallout could cost the global economy as much as $3 trillion by 2020, according to a McKinsey & Co. report.
While the two retail giants may have the wherewithal to absorb the earnings hiccups that invariably accompany a security breach, smaller and more highly levered companies won’t always be so fortunate. Take Altegrity, the government contractor owned by Providence Equity Partners that’s now dealing with the blowback of a cyber-attack in one of its units, US Investigations Services (USIS).
A month after the early August announcement of the attack, one of Altegrity’s major customers, the government’s Office of Personnel Management (OPM) announced it would not extend its contracts with USIS past their current September 30 expirations. The OPM contracts represent about 10 percent of Altegrity’s annual EBITDA, lending sources tell Debtwire. And besides the obvious negative of the earnings loss, the hefty cancellation also raises the prospect that other customers will follow suit.
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