Cybersecurity Mergers, Acquisitions: Deal Values Surge
Merger and acquisition (M&A) deal value in the information security market has reached $21.6 billion in the first nine months of 2019, amounting to a 44 percent spike from the $15 billion in transaction value posted last year, a new report said.
The increase in the value of M&A deals has risen 1442 percent dating back to 2012, according to Precise Security, a website offering tools and resources to help users remove viruses along with a free threat alert service.
Information security M&A deal value in last 10 years has been part roller coaster ride — careening from $13.9 billion in 2010 to a low of $1.4 billion in 2012 — and part relatively steady climb from $7.5 billion in 2013 to $21.6 billion in 2019 year to date.
Cybersecurity Mergers and Acquisitions: More Research Findings
In that period, the number of M&A deals in the segment has been relatively flat from 2010 to 2013, at an average of roughly 78 buyouts per year. However, from 2014 to 2018, the number of deals trended sharply upward, albeit with a couple of dips, from 105 to 131 before slipping to 100 so far this year, for a 23 percent tumble.
In the latter part of that period, global spending on information security technology rose from $75.5 billion in 2016 to $106.6 billion to this point in 2019. Precise Security projects worldwide security spending to increase from $116.6 billion in 2020 to $151.2 billion in 2023. Should the security market reach that threshold, it will have doubled in eight years.
Here are some year-by-year statistics and comparisons:
- In 2012, the value of M&A in the security space reached $1.4 billion, the lowest point since 2010. Starting in 2013, deal value climbed to $7.5 billion, $9.6 billion in 2015, and $21.6 billion so far in 2019.
- The number of merger and acquisition deals in the security industry remained stable during the last seven years but this year has dropped to the lowest level since 2013.
- With the current data, each of the 100 M&A security deals in 2019 reported an average value of $218 million compared to $114.5 million in 2018.
- In 2017, the average value per deal amounted $110.8 million, down 26 percent from the $140 million in 2016. The worse year was 2012, with an average value per deal of $19.1 million.
- Companies are mostly investing in data loss prevention, compliance and risk management.