McAfee Enterprise and FireEye Products will merge under Symphony Technology Group (STG) ownership, the private equity firm has announced. The combined security business will need to work hard to build and maintain trust across the MSSP and MSP parter ecosystems.
This is technology M&A deal number 605 that MSSP Alert and sister site ChannelE2E have covered so far in 2021.
Pre-merger, both McAfee Enterprise and FireEye Products occasionally strayed from their channel partner commitments over the years -- though both firms have also taken steps to solidify MSSP and MSP relations in recent months.
McAfee's partner missteps over the years include acquiring, mismanaging then shutting down MX Logic, one of the first security software businesses for MSPs. FireEye, meanwhile, occasionally competed with security service providers and consulting firms by acquiring Mandiant in 2014.
Mandiant is not part of the McAfee Enterprise-FireEye Product merger, and will instead remain an independent security business.
McAfee Enterprise-FireEye Product Merger: Security Scale and Executive Perspectives
The combined McAfee Enterprise-FireEye Products business will serve 40,000 customers, 5,000 employees, and generate nearly $2 billion in annual revenue, STG says. The business combination is expected to occur during the fourth quarter of 2021, the private equity firm adds.
FireEye’s Bryan Palma will be CEO of the combined company. McAfee Enterprise CFO Ian Halifax will be CFO of the combined entity.
In a prepared statement about the merger, STG Co-Founder and Managing Partner William Chisholm said:
“Cyber risk is the number one threat facing modern organizations and we are excited to advance our growing portfolio of cybersecurity companies. Given Bryan and Ian’s respective experiences leading transformations, we are thrilled to partner with them to unlock value in the cybersecurity market."
“I am energized to lead the integration of McAfee Enterprise and FireEye Products into the next chapter of our shared journey. Our customers need an integrated security platform powered by artificial intelligence, machine learning, and automation. We have an incredibly talented team of security professionals who will work tirelessly to deliver this outcome for our customers.”
Palma previously was BlackBerry’s president and chief operating officer. Earlier, he held key posts at Cisco Systems and Boeing.
Halifax joins from Riverbed Technology where he was CFO and drove the company to "record profitability," STG asserts.
Security Market Shifts to Managed XDR Services
Moreover, much of the IT channel is shifting from a reseller motion towards a managed security services motion. Companies such as Sophos (backed by private equity firm Thoma Bravo) and Webroot (now owned by OpenText) have largely capitalized on that MSP go-to-market wave.
Moreover, multiple security vendors are now racing to unify endpoint, network and cloud security. The strategy typically involves XDR (eXtended Detection and Response). The next move, naturally, is for software companies and/or MSSPs to offer managed XDR services.
As McAfee Enterprise and FireEye Products prepare to step forward together, we'll be watching to see if or how the extend an open hand to MSP and MSSP partners.