Reading-based internet security business Deep-Secure has been sold in a £3.5 million management buy-in backed by private equity firm YFM.

As part of the deal, entrepreneur Richard Beaton has been appointed chairman, and Kieron Sambrook-Smith will be CEO. This is the third investment that YFM has completed involving Beaton, after previous deals with software companies Intuita and Tekton Group. The funding will be used to develop Deep-Secure's technology into new products.

Sambrook-Smith said: 'In today’s fast-changing global security environment, this area of secure information exchange is of increasingly high priority to commercial organisations, government agencies and nations spanning disparate geographies.'

In 2009, YFM completed 74 investments worth £49 million across the UK.