Solvinity fights Dutch ban on Kyndryl deal

Solvinity, the company that hosts the DigiD national ID system serving over 16 million Dutch citizens, is appealing the government’s ban on its acquisition by the American IT service provider Kyndryl.

A spokesperson for Willemijn Aerdts, Minister for the Digital Economy and Sovereignty, confirmed the news to Dutch news outlet NOS after NRC reported on this earlier.

According to NRC, Solvinity said that the company takes the government’s concerns seriously.

“At the same time, we need clarity on the factual and legal basis for the decision. Only with that clarity can we, together with the government, take well-considered next steps toward the best possible outcome for Solvinity,” the spokesperson stated.

Allegedly, Solvinity has asked the court to hear the case behind closed doors, but the judge has refused. However, according to NRC, there is a possibility that certain parts of the oral proceedings will not be open to the public.

Minister Aerdts’ spokesperson told NOS that Solvinity’s appeal has been handed over to the court. Because the case is currently being handled, the Ministry of Digital Economy and Sovereignty is unable to comment on the matter.

At the end of May, Minister Aerdts decided to put a stop to the acquisition of Solvinity.

The Investment Assessment Office (BTI) had concluded that the proposed takeover may pose a risk to the public interest.

“The agency advised me to impose a complete ban on this acquisition. I have adopted this advice and acted upon it,” Aerdts wrote in a letter addressed to the House of Representatives.

In addition, she emphasized that BTI’s investigation was “country-neutral, risk-based, and proportionate.”

“The Netherlands values the presence of foreign technology companies, including American ones, and their contribution to the Dutch economy and digital infrastructure,” Aerdts concluded.

In response, Kyndryl said it was “extremely disappointed” with the government’s decision and stated that it has always collaborated with the cabinet in good faith.

“Despite this collaboration and our long history of managing business-critical activities in the Netherlands, the politicization of this process has overshadowed the clear and significant benefits that this transaction could have offered to Solvinity’s customers and Dutch citizens,” the US company said.