On Feb. 8, Google announced that it has bought the private cybersecurity firm Mandiant for $5.4 billion.
This is one of the largest acquisitions in the search giant's history and a massive bet that helping companies address cyber threats can boost their cloud computing business.
Google Buys Mandiant
Google and Mandiant released a joint statement and said that the acquisition of the cybersecurity firm will complement Google Cloud's existing strengths in security.
The statement continues that together with Google Cloud's cloud-native security offerings, the acquisition will help companies around the world to stay protected at every stage of the security lifecycle.
Google plans to pay Mandiant $23 a share. That represents a 57% premium over the 10-day weighted stock price average, according to TechCrunch.
The stock has increased almost 18% over the last year and it took a nice spike in the past couple of days as rumors began to circulate about the deal.
Google Cloud is central to Google's broader efforts to diversity its revenue beyond its main search advertising business.
Even though Google Cloud sales have grown at a fast rate, it has struggled to compete with services from its rivals like Microsoft and Amazon.
Microsoft was also rumored to be thinking of buying Mandiant, a security firm that focuses on threat intelligence, incident response and cybersecurity testing.
Mandiant has been credited with uncovering the infamous Solar Winds hack, a breach that impacted a number of federal agencies and private businesses, according to Reuters.
Jeff Pollard, the vice president and principal analyst at Forrester, said that Google's cloud business is having a hard time catching up to Microsoft when it comes to cybersecurity.
This forces Google to pay a premium price and be more aggressive with its approach. With this acquisition, Google has shown that it is willing to do just that, according to CNN.
The deal comes at a time when businesses may be feeling heightened cybersecurity concerns given Russia's invasion of Ukraine.
In the past few weeks, officials of the United States have been warning businesses and local governments about the threat of cybersecurity attacks, given Russian hackers have gone after its targets in the United States.
Mandiant's History
Mandiant launched in 2004 and it was purchased by FireEye back in 2013. It was spun out as an independent company after FireEye sold its business in 2021 for a total of $1.2 billion.
At the time, the company's founder, Kevin Mandiant, who had eventually become FireEye CEO, said that the deal was made to unlock the value of Mandiant as a standalone business. It certainly got a much heftier price than FireEye did.
Google's acquisition of the firm is expected to close this year. Mandiant eventually took the position of several acquired company. The security firm said that the deal gave the company access to the scale and resources of Google Cloud.
Mandiant said in a statement announcing the deal that together with Google Cloud, they will deliver their expertise and intelligence at scale through the Mandiant Advantage SaaS platform, as part of the Google Cloud security portfolio.
Before the deal permanently closes, the transaction will have to run the regulatory gauntlet and get the approval of the Mandiant stockholder. The companies believe that a close date will happen some time later this year.
In 2021, T-Mobile teamed up with Mandiant after a massive security breach.
Earlier this year, Google Cloud expanded its anti-crypto hacking machine through virtual machine threat detection.
This article is owned by Tech Times
Written by Sophie Webster
