CRN reported that Intel Security has agreed to sell its McAfee Next-Generation Firewall and Firewall Enterprise business to the Raytheon|Websense joint venture. The pending acquisition was announced to Raytheon|Websense employees on Monday in an internal memo, and will be the entity's first acquisition since Raytheon acquired a majority stake in Websense for $1.9B from Vista Equity Partners in May.
According to CRN, for Raytheon|Websense, "the acquisition also expands the hybrid cloud capabilities of the company's Triton security platform, as well as adds key security talent to the company's lineup." For Intel Security, "the divestiture of the two McAfee brands fits into a strategy of stepping away from product lines that do not fit into its new strategy around security outcomes for protection, detection and correction."
The transaction is expected to close at the end of the year.
Platinum Equity Holdings has entered into an agreement to divest Hebron, Kentucky-based Pomeroy IT Solutions, Inc. to Clearlake Capital Group LP, who will combine the acquired entity with its portfolio company Tolt Solutions to create The Pomeroy Group which will have over 4,000 employees and nearly $1B in annual revenues. Pomeroy is a provider of comprehensive IT infrastructure services to clients in sectors including banking/financial services, manufacturing, energy, environment, retail, and the public sector. The company's government clients are primarily state and local municipalities including The Port Authority of NY and NJ, Commonwealth of Kentucky, and the State of West Virginia.
According to the company's press release: "The creation of the Pomeroy Group will enable each business to benefit from expanded scale, corporate resources, service capabilities and financial flexibility. Tolt Solutions will operate as a standalone division within the Pomeroy Group, maintaining its core focus as the leading retail industry-focused IT expert providing managed services to grocery, retail, convenience, food service and distributed enterprise customers."
Terms of the deal were not disclosed. Financing will be provided by Natixis and Brightwood Capital Advisors. William Blair is the financial advisor to Pomeroy and PJT Partners is the financial advisor to Tolt Solutions.
Aeryon Labs Inc. announced that it has secured a $60M investment from Summit Partners to expand its presence within the military, public safety and commercial markets worldwide. Waterloo, Ontario-based Aeryon manufactures small unmanned aerial systems (sUAS) and mission control systems that provide mission-critical aerial intelligence for various applications. The company's defense and government applications include covert operations, emergency and disaster response, perimeter and convoy security, and tactical operations.
Benchmark Electronics announced that it has entered into a definitive agreement to acquire Secure Communication Systems, Inc. for $230M in cash on a debt-free, cash-free basis from private equity firm Vance Street Capital. Based in Santa Ana, CA, Secure Communication Systems is a provider of high performance electronics, sub-systems, and components for mission critical applications in the aerospace, industrial, and defense markets.
Benchmark will fund the deal from its existing credit facility. The transaction is expected to close in the fourth quarter of 2015 subject to closing conditions and regulatory approvals, and will be immediately accretive to margins and EPS.
JP Morgan Securities LLC is the financial advisor to Benchmark and Sheppard Mullin Richter & Hampton LLP is its legal counsel. Harris Williams & Co. is acting as financial advisor to Secure and O'Melveny & Myers LLP is acting as legal counsel.
Publicly-traded SolarWinds (NYSE: SWI) announced that it has entered into a definitive agreement to be acquired by private equity firms Silver Lake Partners and Thoma Bravo LLC for $60.10 per share or approximately $4.5 billion in cash. The purchase price represents a 43.5 percent premium to the closing price as of October 8, 2015 (when the company announced that it was exploring strategic alternatives) and translates to 9.5x trailing revenue.
SolarWinds provides hybrid IT infrastructure management software to various customers including Fortune 500 companies, small business, education institutions and government agencies. Government clients include: US Marines, US Army, US Navy, US Air Force, DISA, Department of Health and Human Services, and the State of Texas.
The transaction is expected to close in the first quarter of 2016. JP Mortan Securities LLC is acting as financial advisor, and DLA Piper LLP is serving as legal advisor to SolarWinds. Kirkland & Ellis LLP is serving as legal advisor to Thoma Bravo and Ropes & Gray LLP is serving as legal advisor to Silver Lake.
Publicly-traded CyberArk announced that it has completed the acquisition of Viewfinity, Inc., a provider of Windows least privilege management and application control software for $30.5M in cash. Viewfinity is based in Waltham, MA and provides solutions that eliminates the administrative bottlenecks of operating wit admin rights removed while bringing end-point level visibility and actionable data to security. Prior investors included Giza Venture Capital, JK&B Capital, and Longworth Venture Partners.
According to the press release, "With the transaction complete, CyberArk now offers customers a solution that limits the privileges available to business users and applications to only what is needed, while protecting the organization from advanced attacks. This enables organizations to stop the progression of most malware-based attacks at the endpoint, limiting the attacker’s ability to move beyond their initial point of entry. The offering complements CyberArk’s Privileged Account Security Solution and is available as either an on-premise or SaaS-based solution."
The acquired business is projected to contribute approximately $7-$9M in revenue and will be accretive on a non-GAAP basis for 2016. The implied 2016 revenue multiple is 3.4-4.4x.
Thales announced that it has signed a definitive agreement to acquire San Jose-based Vormetric, a provider of data protection solutions for $400M. According to the press release, "Vormetric is the industry leader in data security solutions that protect data-at-rest across physical, big data and cloud environments. With a workforce of 200 employees, Vormetric helps over 1,500 enterprises, including 17 of the US top 30 companies, to protect their sensitive data from both internal and external threats. The company’s scalable Vormetric Data Security Platform protects any file, any database and any application’s data — anywhere it resides — with a high performance, market-leading solution set."
Investors in Vormetric include JK&B Capital, QTV Capital, Quicksilver Ventures, Sigma Partners, Split Rock Partners, and Vanguard Ventures.
The company's revenue is projected to reach $75M for the current fiscal year which implies a revenue multiple of 4x revenue. The deal is expected to close during the first quarter of 2016.
Reuters is reporting that three sources familiar with the deal claim that the $9.1 billion acquisition of Sikorsky Aircraft from United Technologies could close by late October or early November. The deal was initially expected to close at the end of 2015 or early 2016. Officials in the US, South Korea and Japan have approved the deal but both companies are still waiting for regulatory approvals in other jurisdictions including China and the European Union.
L-3 Communications announced that is has acquired ForceX, Inc., a Nashville-based ISR company focused on providing mission management software and geospatial application technology programs, with products including cueing system software, hardware and video algorithms, and wide-area sensor integration solutions and software. A significant amount of the company's revenue comes from the US Air Force. The business will be renamed L-3 ForceX and will be integrated into L-3's Integrated Sensor Systems (ISS) sector with the Electronic Systems business segment.
According to the company's press release, “ForceX complements L-3’s core business, enhancing our product and system capabilities to compete in new markets, and expands our customer base.”
The transaction closed on October 13, 2015. Deal terms were not disclosed, however the goodwill and other intangible assets from the acquisition are expected to be deductible for income tax purposes suggesting the deal was structured as a stock purchase with a 338(h)(10) election. The acquisition is projected to add approximately $30M in revenue for the year ending December 31, 2016 and is expected to be immediately accretive. KippsDeSanto advised ForceX on the transaction.
Avon Rubber announced that it has acquired the Argus thermal imaging camera business from e2v technologies. UK-based Argus manufactures thermal imaging cameras for the first responder and fire markets. The business generated approximately £5 million last year. The purchase price was £3.5 million payable in cash and was financed from existing debt facilities.
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