The Consolidation Continues: A Look at Cybersecurity M&A Activity in August 2023

Cybersecurity M&A Roundup for August 1-15, 2023

Introduction

Twenty-five cybersecurity-related merger and acquisition (M&A) deals were announced in the first half of August 2023, according to an analysis conducted by SecurityWeek. This rebound in activity follows a significant drop in June and brings the total number of cybersecurity-related M&A deals announced in the first half of 2023 to more than 210.

Armor acquires Quantum Security

US-based cloud security firm Armor has acquired Singapore-based Quantum Security, a security firm specializing in cloud automation and services. This deal will enhance Armor’s capabilities in cloud security and IT risk.

Bechtle acquires Sastema

German IT giant Bechtle has acquired Germany-based identity and access management (IAM) firm Sastema. This acquisition marks the launch of Bechtle’s new IAM Competence Center, led by Sastema managing director Sven Almoril.

Centric Consulting acquires The Mako Group

Management consulting firm Centric Consulting has announced the acquisition of risk management company The Mako Group. This purchase will expand Centric Consulting’s capabilities in risk management.

Check Point acquires Perimeter 81

Network security giant Check Point Software has agreed to acquire Secure Access Service Edge (SASE) and Zero Trust Network Access (ZTNA) solutions provider Perimeter 81 for approximately $490 million.

Deloitte acquires ParaFlare

Deloitte Australia has acquired Australia-based MDR solutions provider ParaFlare. Deloitte and ParaFlare will now offer various cyber defense capabilities, including threat detection, threat intelligence, incident response, recovery, and remediation. Deloitte will integrate ParaFlare’s nearly 80 employees into its operations.

ManTech acquires Definitive Logic

Defense firm ManTech has acquired tech consulting and solutions provider Definitive Logic. Both companies offer their services to the US government. This acquisition will enable ManTech to expand its capabilities, including in cyber.

Partner One acquires Fidelis Cybersecurity

Enterprise software company Partner One is acquiring software, intellectual property, equipment, and contracts of Fidelis Cybersecurity, a provider of XDR and cloud-native application protection solutions provider. Partner One will integrate the acquired assets into its existing product portfolio.

Prembly acquires Tunnel

Compliance and anti-fraud solutions provider Prembly has announced the acquisition of data sharing company Tunnel. Both Prembly and Tunnel are Nigerian companies. This deal will help Prembly enhance its security suite and expand its financial services.

Protect AI acquires Huntr

Artificial intelligence and machine learning (AI/ML) security company Protect AI has acquired the Huntr bug bounty platform and has launched the first bug bounty platform focusing on AI/ML open-source software, foundational models, and ML systems.

Rubrik acquires Laminar

Data security firm Rubrik has purchased data security posture management (DSPM) platform Laminar. The financial details of the acquisition vary between different sources, with some reporting a price of $200-250 million and others describing it as a deal exceeding $100 million.

SIG acquires Triaxiom Security

Higher education IT consulting firm Strata Information Group (SIG) has acquired Triaxiom Security, a cybersecurity company specializing in penetration testing, compliance auditing, and strategic security services. As a result of the deal, SIG will launch SIG Cyber, a cybersecurity consulting practice focusing on the higher education sector.

Seceon acquires Helixera

SIEM and XDR solutions provider Seceon has announced the acquisition of real-time pattern scanning engine Helixera. This acquisition will enhance Seceon’s capabilities in cybersecurity. Seceon has also hired Helixera founder Waldek Mikolajczyk as VP of Cybersecurity Solutions Architecture.

Sentar acquires Waterfront Technical Services

Sentar, a company providing cybersecurity, systems engineering, intelligence, and analytics solutions to the US government, has acquired Waterfront Technical Services. Waterfront Technical Services has a portfolio that includes flight and ground operations, data center operations, IT, software development, and test supporting NASA’s spaceflight missions. This acquisition is part of Sentar’s expansion strategy.

T-Rex acquires Cyber Cloud Technologies

T-Rex Solutions has acquired Cyber Cloud Technologies. Both companies provide cybersecurity and other IT services and solutions to US government agencies. This acquisition is expected to accelerate T-Rex Solutions’ growth.

We Hack Purple merges with Semgrep

AppSec platform We Hack Purple, which offers training and other resources for developers and security experts, is merging with application security company Semgrep. The goal of this merger is to create a powerhouse of application security expertise.

Zurich Holding Company of America acquires SpearTip

Zurich Insurance Group subsidiary Zurich Holding Company of America has acquired SpearTip, a cyber counterintelligence firm specializing in incident response, managed detection and response (MDR), and risk management. This acquisition expands the capabilities and risk mitigation services of Zurich Resilience Solutions’ cyber team.

Zyston acquires Complyify

MSSP Zyston has acquired Complyify, a company that provides AI-driven cybersecurity risk and compliance management solutions. Complyify’s AI expertise will be integrated into Zyston’s cybersecurity offerings.

Conclusion

The first half of August 2023 saw a significant increase in cybersecurity-related M&A activity, with 25 deals announced in this period. This surge in activity reflects the ongoing consolidation trend in the cybersecurity industry as companies seek to enhance their capabilities and expand their market reach. These acquisitions will undoubtedly have an impact on the competitive landscape of the cybersecurity industry and could lead to the development of more comprehensive and integrated cybersecurity solutions.

Editorial

The cybersecurity industry is witnessing a wave of merger and acquisition deals as companies seek to strengthen their capabilities in an increasingly complex and dynamic threat landscape. By acquiring specialized firms and technologies, companies can enhance their cybersecurity solutions and offer more comprehensive protection to their customers.

While consolidation can bring benefits in terms of improved efficiency and innovation, it also raises concerns about concentration of power and potential negative effects on competition. As larger companies vie for dominance in the market, smaller players may struggle to compete, leading to reduced choice and potentially higher costs for customers.

Additionally, the cybersecurity industry is not immune to the risks and challenges associated with M&A activity. Integrating different organizations, cultures, and technologies can be a complex process that requires careful planning and execution. Any missteps during the integration process could result in disruptions or vulnerabilities in the merged company’s security posture.

Advice

For companies considering M&A deals in the cybersecurity space, it is essential to prioritize security throughout the entire process. This includes conducting thorough due diligence on the target company’s cybersecurity posture, assessing potential risks and vulnerabilities, and developing a comprehensive integration plan that ensures the continuity and resilience of security operations.

Furthermore, companies should prioritize diversity and competition in the cybersecurity industry. While M&A deals can lead to innovation and improved cybersecurity solutions, it is important to support a healthy ecosystem of companies that can offer different perspectives and approaches to security challenges. This can help drive innovation and ensure that customers have a wide range of choices when it comes to cybersecurity solutions.

Lastly, companies should not overlook the importance of investing in their internal cybersecurity capabilities. While M&A deals can bring external expertise and technologies, it is crucial to have a strong foundation of internal cybersecurity capabilities to effectively manage and mitigate risks. This includes having well-trained cybersecurity professionals, robust security policies and practices, and a proactive approach to identifying and addressing emerging threats.

In summary, the surge in cybersecurity-related M&A deals in August 2023 reflects the industry’s ongoing consolidation trend. While these deals can bring benefits, companies must prioritize security, diversity, and competition to ensure the development of robust and innovative cybersecurity solutions.