Reston cybersecurity company Mandiant Inc. (NASDAQ: MNDT) said early Tuesday it has reached a deal to sell to Google LLC for $23 per share in an all-cash deal valued at $5.4 billion.
The buy represents the second-largest deal in Google’s history after its 2012 purchase of Motorola Mobility for $12.5 billion.
Mandiant, led by founder and CEO Kevin Mandia, said the sale price is a 57% premium on its shares prior to sale speculation heating up in early February. The deal is expected to close later this year, at which time Mandiant will join Google Cloud, a division of Mountain View, California's Alphabet Inc. (NASDAQ: GOOGL) that records more than $19 billion in annual revenue.
Google said the purchase will strengthen its detection, intelligence, automation and response as it relates to cyberthreats as well as its advisory services to customers.
In a statement, Google Cloud CEO Thomas Kurian said the deal creates “an opportunity to deliver an end-to-end security operations suite and extend one of the best consulting organizations in the world.”
Mandiant’s talks with Google were first reported Monday afternoon by The Information, sending Mandiant’s share price up 16% to $22.49 by market close.
The deal follows much speculation of a sale, with Microsoft Corp. (NASDAQ: MSFT) circling the cyber company in early February and sending Mandiant’s stock up by more than 15%. Its share price was down 3.8% in premarket trading Tuesday.
In late February, John Watters, Mandiant’s president and chief operating officer, declined to comment on sale rumors to the Washington Business Journal, saying that the company “partners with everybody, including Microsoft. They’re a good strategic partner of ours.”
Mandiant was purchased by fellow cyber company FireEye Inc. in 2013, but it turned around and sold off FireEye’s products business to an investor group led by Symphony Technology Group late last year for $1.2 billion in cash. Watters told the WBJ the sale of FireEye’s products business helped streamline Mandiant’s remaining subscription-as-a-service model.
Nearly half of Mandiant’s 2,200 employees are based in Greater Washington.
Mandiant's revenue for all of 2021 was $483 million, up 21% year-over-year. While its losses from continuing operations last year totaled $409 million, it logged a total $918.57 million in profits for the year. The company’s annualized recurring revenue was $279 million at the end of 2021, 23% higher than at the end of the fourth quarter of 2020.
