Cybersecurity Acquisitions, Mergers Heat Up After Pandemic-Prompted Pause
More acquisitions could occur before any possible federal tax increases.
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Private equity firm Thoma Bravo is shelling out a whopping $12.3 billion for Proofpoint.
“As ransomware attacks have become daily headline news around the world, the world’s largest private equity firms have identified an enormous total available market for a wide range of cybersecurity services, from assessments to penetration testing, to managed detection and response (MDR),” said the CFA’s John Holland. “Bain Capital, Carlyle Group, KKR, Silver Lake Partners, and Vista Equity have jumped into the cybersecurity industry with acquisitions.”
Cloud-native security is a particularly active part of cybersecurity M&A, Holland said.
“Over the past few years, businesses have been racing to migrate applications to Azure, AWS, Google Cloud, and the myriad of private cloud hosting companies without fully comprehending the cybersecurity risks of the public cloud, private cloud, hybrid cloud and the Kubernetes/container technology that enables fluid migrations between these various cloud platforms,” he said. “Let me cite two acquisitions in this space in Q2 2021. In Q2 2021, Bain Capital and Crosspoint Capital acquired ExtraHop, a cloud-native network detection and response solutions provider. Also in Q2 2021, there was an interesting merger of AWS advanced consulting partner Zuggand with Cyber Security Works, a company that provides vulnerability management as a service.”
In late July, CDW acquired Focal Point Data Risk, a provider of cybersecurity services with customers across a diverse set of industries. CDW said adding Focal Point’s array of security consulting, customer workforce skills development and professional services capabilities expands its services portfolio and enhances its ability to address risks posed by malicious cyber threats and cyber workforce shortages, while helping customers successfully navigate shifting data protection laws.