Forcepoint Government Unit Sells for $2.45 Billion

Private equity firm Francisco Partners is flipping the Forcepoint government business to TPG.

Forcepoint’s public sector unit, known as G2CI, will go to TPG’s late stage private equity platform for $2.45 billion. The definitive agreement amounts to more than more than double Francisco Partners paid to purchase Forcepoint nearly three years ago, according to the Wall Street Journal. Meantime, Forcepoint executives say the commercial business will focus on its secure access service edge (SASE) business under the oversight of Francisco and other investors.

The deal must first clear regulatory approval. The parties said they expect the transaction to wrap in the fourth quarter of 2023. Francisco will retain a minority stake in Forcepoint, according to reports by the Journal.

As of press time, Forcepoint had not responded to questions from Channel Futures about partner impact.

TPG is getting its hands on a provider that works closely with the U.S. Department of Defense and other U.S. agencies.

Forcepoint’s Sean Berg

“It’s our mission to support the national security and intelligence communities by providing trusted, data-driven security solutions that enable them to collaborate and conduct mission-critical work securely and effectively,” said Sean Berg, Forcepoint’s president of global governments and critical infrastructure. “TPG has a long history of carving out, building and scaling world-class cybersecurity companies. We’re confident that this partnership, along with continued support from Francisco Partners, will provide us the resources and expertise to strengthen our position as a partner of choice for government agencies.”

Francisco closed its acquisition of Forcepoint in early 2021. It purchased the security company from the defense provider Raytheon, which had spun off Forcepoint in 2016. Channel Futures reported in March 2021 that the acquisition led to layoffs of “most of its North American channel team.”

Forcepoint Government Unit Background

Reuters reported in April that Forcepoint was mulling a sale of its public sector business. Forcepoint and its advisor Citigroup, were looking to sell the division, reportedly worth $400 million in annual revenue, for more than $2 billion, Reuters wrote. The unit’s accomplishments include an $89 million deal with the U.S. Department of Defense for user activity monitoring software. It possesses a similar contract with the U.S. Air Force running through 2026, according to Highergov.com.

Forcepoint’s Manny Rivelo

“We are proud to have built an industry-leading portfolio of security products that protect government and enterprise customers’ infrastructure, people, and data,” Forcepoint CEO Manny Rivelo said. “This transaction represents an exciting opportunity for the Forcepoint G2CI business to continue its trajectory of growth, delivering high assurance security to government and critical infrastructure customers worldwide. Similarly, it enables the Forcepoint Commercial business to further focus investment and innovation in accelerating growth of the company’s Data-first SASE platform, Forcepoint ONE, while delivering increased value to our customers.”

Brian Decker, partner at Francisco Partners, said his company will remain investors in G2CI.

“Sean and the Forcepoint G2I team have been excellent partners and built a thriving business that will benefit from operating as its own standalone business,” Decker said.

Forcepoint announced a new MSSP program in April, targeting, service providers, distributors and resellers.