Network security firm Proofpoint goes private in $12.3 billion deal

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Private equity firm Thoma Bravo has announced plans to acquire cybersecurity firm Proofpoint in a deal worth $12.3 billion.

The deal serves as further proof, if it were needed, that demand for cloud-based security is at an all-time high, driven in large part by the continued adoption of cloud computing and the rise of remote working. , which requires strong network security. .

Founded in 2002 by former Netscape CTO Eric Hahn, Proofpoint was originally known for an email security product that helped companies identify spam, viruses and other email correspondence that might violate Internet policies. ‘business. Over the next few years, the Sunnyvale, Calif.-based company expanded its focus to include a suite of cloud-based security products designed to protect businesses against targeted threats.

Proofpoint went public in 2012, with its shares initially trading at around $13. These have risen steadily over the past decade, reaching an all-time high of $140 earlier this year and giving it a market capitalization of over $7 billion.

Thoma Bravo has a history of taking public cybersecurity firms private, having done so with network security firm Barracuda in a 2017 deal worth $1.6 billion and with Sophos last year for $3.9 billion. The Proofpoint deal, which is expected to close in the third quarter of 2021, provides for Thoma Bravo to pay a 34% premium to Proofpoint’s closing price on the last full trading day (April 23), with shareholders to receive $176 for every share they own.

It’s worth noting that the $12.3 billion price tag makes it the biggest cybersecurity acquisition of all time, putting it ahead of the $7.68 billion Intel paid for McAfee 11 years ago. And according to VentureBeat’s calculations, the acquisition of Proofpoint represents one of the largest global technology acquisitions ever, placing it in the top 20, alongside mega-deals that include the $67 billion purchase of EMC. dollars by Dell, IBM’s $34 billion Red Hat deal, and Salesforce’s impending $27.7 billion acquisition of Slack.

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Kevin M. Risinger