PARIS ― Communications & Systèmes, a specialist in mission-critical systems, is in exclusive negotiations to acquire cybersecurity company Novidy’s in a deal worth €35.6 million (U.S. $43.6 million), CS said.

CS will also raise €10 million in a rights issue to continue its expansion through mergers and acquisitions, the company said in a April 23 statement.

“This is a first step in CS’s strategic plan, Ambition 2021, which aims to double the group’s size by 2021,” company CEO Eric Blanc Garin told Defense News on April 24. There had been competing bids for Novidy’s, which picked CS as the preferred bidder.

“I am happy they chose CS,” he said. “Novidy’s is a great company with a great team.”

That acquisition is key in the CS expansion drive, which seeks to boost annual sales to €300 million by 2021. Cybersecurity is a strategic sector, and an acquisition of Novidy’s is part of CS’ aim to be among the top-five French cybersecurity firms, he added.

According to a CS representative, the top-five French cybersecurity companies are Atos, Orange, Sogeti, Sopra and Thales.

Cybersecurity specialists will help clients set up “cybersecurity operating centers running 24/7,” as companies are looking for protection of information and embedded systems while guarding themselves against external intrusion, he noted.

The executive said cybersecurity is a strategic activity for his company, along with defense, public safety and space.

CS will acquire some 70 percent of Novidy’s by paying €30 million in cash, which will be funded by a bank loan. CS will issue new stock and share warrants to acquire the remaining stake.

The CS annual general meeting will vote June 26 on the proposed deal, which will be presented to CS staff and regulatory authorities. Sopra Steria Group, which holds 11.4 percent of CS, has signaled it will subscribe to the share issue and has said it backs Ambition 2021, according to CS.

Novidy’s posted its 2017 operating profit of €3.2 million on sales of €32 million. The company grew annual sales of more than 20 percent over the last four years and employs 130 staff.

CS posted its 2017 operating profit of €8.3 million on sales of €178.1 million.