Cybersecurity Merger Combines Spycraft, Data
Aiming to augment its virtualized platform for cyber defense with what it calls an "intelligence-led approach" to cyber security, FireEye Inc. has completed its acquisition of privately-held iSight Partners, a leading provider of cyber threat intelligence.
The acquisition announced last week also combines the expertise of Mandiant, a unit of FireEye (NASDAQ: FEYE), with iSight's more than 250 cyber threat intelligence analysts stationed in 17 countries. Cyber security software provider FireEye, Milpitas, Calif., acquired Mandiant in January 2014 in a deal worth more than $1 billion. Mandiant, Reston, Va., made headlines in 2013 when it released a report uncovering a hacking group linked to China's People's Liberation Army.
FireEye said it paid about $200 million in cash to acquire all outstanding shares of iSight. Former shareholders could gain an additional $75 million in cash and equity if the merged company hits its bookings target by 2018. FireEye's spending spree to acquire Mandiant and iSight underscores the growing strategic importance of cyber security for enterprises that increasingly handle sensitive and private data.
"The acquisition brings together two of the world's leading threat intelligence organizations, each with a different and complementary perspective on the threat environment," FireEye CEO David DeWalt, said during a conference call with analysts announcing completion of the deal. "It also represents a significant milestone in the development of our unified intelligence-powered threat management platform."
The IT security specialist claims credit for inventing a virtual machine-based security platform designed to provide real-time threat updates to corporations and governments agencies. At the heart of the platform is a "virtual execution engine" that is combined with threat intelligence to identify and block cyber attacks as they unfold.
FireEye further claims its cyber defense platform outperforms traditional firewalls, intrusion prevention systems, anti-virus software and security gateways. It provides threat protection without the use of signature-based defenses widely used to thwart network attacks or vulnerability exploits. The company claims its approach also monitors different stages of ongoing cyber attacks.
The merged company combines machine and human intelligence to provide "actionable intelligence," DeWalt said.
FireEye claims more than 4,000 customers in 67 countries, including more than 650 global corporations.
Dallas-based iSight Partners reportedly hires overseas agents, some former security officials, in hotspots like Brazil, India and Ukraine to monitor online forums to stay ahead of potential cyber threats. Its human intelligence approach differs from traditional cyber defense firms that rely heavily on data and algorithms to fend off attacks.
FireEye is betting that the combination of iSight's street intelligence combined with its cyber hardware and software capabilities will appeal to a broad range of enterprises, especially retailers, struggling to fend off cyber attacks. The company said the acquisition would allow it to provide more granular alerts that would help customers prioritize cyber threats.