KKR & Co is to buy cybersecurity firm Barracuda Networks from its private equity owner Thoma Bravo, highlighting continued interest in cybersecurity businesses from buyout firms.
The announcement did not disclose financial terms. Sources who requested anonymity said the deal valued California-based Barracuda Networks at about US$4 billion, including debt.
Dealmaking in cybersecurity has jumped in recent months as the pandemic accelerated the shift to remote working, forcing companies to ramp up spending in the sector. Russia's invasion of Ukraine has also led to a spike in cyberattacks.
Thoma Bravo on Monday agreed to buy cybersecurity firm SailPoint Technologies, while Datto, a security solutions provider, was also taken private in a $6.2 billion deal by investors led by Insight Partners.
Reuters reported in February that KKR was exploring a sale or an initial public offering for Optiv Security Inc, a U.S. cybersecurity solutions distributor and consultant it controls at a valuation of more than $3 billion, including debt.
Founded in 2003, Barracuda manages the data security of its customers over the cloud on a subscription basis, providing a range of services including email protection, software and cloud security, network security and data protection.
Thoma Bravo took the company private in 2017, four years after it went public. Barracuda has since grown into a business that generates over $500 million in annual revenue, KKR said. It has also made a series of acquisitions, including buying extended detection and response service SKOUT Cybersecurity and zero-trust access provider Fyde.
The Barracuda deal is set to close by the end of 2022, KKR said on Tuesday. KKR, which has $471 billion of assets under management, is a prolific investor in cybersecurity companies. Some of its investments include ForgeRock, Ping, Cylance and DarkTrace.
J.P. Morgan acted as financial advisor for Thoma Bravo and Barracuda, while Guggenheim Securities, DBO Partners and Barclays advised KKR.
(Reporting by Chibuike Oguh in New York and Akash Sriram in Bengaluru; Writing by Anirban Sen and Krystal Hu; Editing by Saumyadeb Chakrabarty, David Holmes, Alexander Smith and Chizu Nomiyama)