October 16, 2024 – Solganick & Co. (“Solganick”) has published its latest M&A update on the Cybersecurity industry sector. It covers the latest mergers and acquisitions deal announcements, valuations, public company data, and other trends announced in Q3 2024.

Here is a summary of the report:

• M&A transaction activity for cybersecurity companies in Q3 2024 improved over the previous quarter but declined from the prior year and remained below levels in 2021 and 2022. Strategic buyers were significantly more active than financial buyers, continuing the trend from recent quarters.
• Further interest rate cuts could spur increased M&A activity by financial buyers, including add-ons to existing platforms. While we don’t anticipate a return to 2021 levels in the imminent future, we look for healthier M&A activity over the next 12 months due to ongoing consolidation across several cybersecurity sub-sectors.
• Security Operations constituted the largest sub-sector of M&A activity, reflecting the tremendous deficit of human security experts and strong demand for managed security and other cybersecurity services. Transaction drivers included geographic expansion, complementary expertise/verticals, and automation enhancements.
• Data Protection, Risk Management, and Infrastructure were other key sub-sectors of M&A activity. Acquirers in the data protection space are increasingly focusing on data resilience and data backup and disaster recovery, driven by escalating ransomware attacks against essentially all types of organizations worldwide.
• Valuation multiples for publicly-traded cybersecurity companies ranged from a median 9.5x EV/2024E revenue for high growth (>20%) vendors to a median 4.0x EV/2024E revenue for low growth (<10%) vendors.  

Notable cybersecurity M&A Transactions announced in Q3 2024 include:

• Visa acquires Feature Space, an AI-enabled fraud prevention and risk management software with real-time detection and sophisticated behavioral analytics.
• Veeam acquires Alcion, an AI-powered data management and protection specialist with a focus on Microsoft 365.
• MasterCard acquires Recorded Future, a leading threat intelligence platform with predictive risk, SecOps, third-party, and brand protection components, for $2.65B.
• Salesforce acquires Own, a cloud data protection and management solution with compliance, automation, and AI features, for $1.9B.
• Check Point acquires Cyberint, an external attack surface management (EASM) and threat intelligence platform with data leak detection and threat actor profiling components, for $200M.

You can review and download the full report here: Solganick Cybersecurity M&A Update – Q3 2024

About Solganick & Co.

Solganick is a data-driven investment bank and M&A advisory firm focused exclusively on software and IT services companies.  Formed in 2009, with offices in Los Angeles and Dallas, its professionals have completed over 200 M&A transactions to date.

Please contact Michael Kim, Director – Cybersecurity and Technology Investment Banking, to inquire about an M&A opportunity or for questions regarding this report.

Email: [email protected]