In the first half of May 2023, 17 cybersecurity-related mergers and acquisitions (M&A) deals were announced, according to an analysis by SecurityWeek. The deals ranged from a private equity firm acquiring endpoint security and secure access solutions provider Absolute Software for approximately $870 million, to smart ring company Ōura acquiring digital identity signal platform Proxy in an all-equity deal valued at $165 million.
These transactions reflect the ongoing consolidation trend in the cybersecurity industry, as companies seek to expand their portfolios and capabilities through M&A deals. This trend is not new; SecurityWeek reported last year that more than 450 cybersecurity-related M&A deals were announced in 2022, and this trend is expected to continue.
Strategic acquisitions like Boecore’s acquisition of La Jolla Logic and CACI’s acquisition of Bitweave make sense as both companies already provide services to various departments of the US government. Crosspoint Capital Partners’ acquisition of Absolute Software aims to take the company private, and may help the company focus more on product development and innovation away from the scrutiny of public investors.
Databricks’ acquisition of Okera is also an interesting move. Databricks’ platform for unifying data warehousing and AI will benefit from Okera’s AI-centric data governance platform, which automatically discovers and classifies sensitive data and provides new isolation technology. GeoComply’s acquisition of OneComply further enhances the company’s fraud prevention and cybersecurity solutions, with the compliance and licensing management platform designed for companies in regulated markets.
In addition to these deals, managed security services providers (MSSPs) and distributors announced several acquisitions in the first half of May 2023. For example, Applied Connective acquired Connecting Point, DartPoints acquired Venyu, and ePlus acquired CCI Systems’ Network Solutions Group, among others.
As the cybersecurity industry continues to consolidate, companies must be aware of the benefits and risks that come with M&A deals. Consolidation can lead to enhanced capabilities and broader market reach, but there is also the risk of integration challenges and dilution of focus. Companies must be diligent in their analysis and execution of M&A deals to ensure they achieve their strategic goals and provide value to their customers.
<< photo by Max Kleinen >>
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