Unsecured M&A

In the past month alone, we’ve seen a number of landmark IT security transactions. Symantec inked the largest-ever software-as-a-service security deal, paying $695m for MessageLabs. The largest pure security vendor, McAfee, announced its biggest deal, doubling down on network security with its $497m purchase of Secure Computing. And the formerly somnolent Sophos shook off its sleepiness to go shopping. It recently closed its $341m purchase of Utimaco, the largest acquisition of a publicly held security company by a private company.

So with all of these big-ticket transactions, overall deal flow in security should be strong, right? Actually, year-to-date totals are running at less than half the level of either of the previous two years. The reason: large consolidation plays have been knocked off the table this year. So far, just one security transaction worth more than $500m has been announced, down from five during the same period last year and four in 2006.

Security M&A totals

Period Deal volume Deal value Selected transactions
January 1-October 13, 2006 96 $6bn EMC-RSA, IBM-Internet Security Systems
January 1-October 13, 2007 70 $7.2bn Cisco-IronPort, SafeNet LBO, Google-Postini
January 1-October 13, 2008 68 $2.7bn Symantec-MessageLabs, McAfee-Secure Computing

Source: The 451 M&A KnowledgeBase