Top Cybersecurity Mergers and Acquisitions in 2024
The business world in 2024 has seen its fair share of challenges, from economic uncertainties to political tensions. Despite these obstacles, there have been some significant mergers and acquisitions (M&A) in the cybersecurity sector this year. Stuart Pilgrim, Head of Cybersecurity M&A at KPMG UK, noted that the cybersecurity market is still quite fragmented, making it ripe for consolidation.
One of the key drivers behind the M&A activity in 2024 has been the resurgence of private equity interest in cybersecurity. Mark Smith, Director at Houlihan Lokey’s Technology Group, highlighted Thoma Bravo’s $5.3bn acquisition of Darktrace in October as a prime example of this trend. The perception of cybersecurity as a high-growth market has fueled private equity confidence and investment.
Another factor contributing to the increase in M&A deals is the desire for larger cybersecurity companies to enhance their offerings and capabilities. Companies are looking to provide more comprehensive solutions to their customers, reducing the need for multiple vendors. Examples of this include Sophos’ intended purchase of SecureWorks for $859m and CyberArk’s $1.5bn acquisition of Venafi.
Managed Detection and Response (MDR) services and Security Operations Centers (SOCs) have been in high demand, with investors looking to build cybersecurity platforms of scale. These services are attractive to buyers due to their recurring nature, which fosters long-term customer relationships.
Looking ahead to 2025, analysts predict that cybersecurity M&A activity will continue to grow as companies seek to expand their capabilities. There may be a particular focus on next-generation technologies like AI, which can improve productivity and help bridge the cybersecurity skills gap. Businesses running Security Operation Centers (SOCs) may invest in AI and automation capabilities to streamline their operations.
In 2024, there were several noteworthy M&A deals in the cybersecurity sector. Here are the top five deals, based on financial value:
1. Cisco’s $28bn acquisition of Splunk, a machine-data analytics platform provider.
2. Thoma Bravo’s $5.3bn acquisition of Darktrace, a UK-based cybersecurity firm specializing in AI solutions.
3. Mastercard’s $2.65bn deal to acquire threat intelligence company Recorded Future.
4. CyberArk’s $1.54bn acquisition of Venafi to build end-to-end machine identity solutions.
5. Additional deals announced in 2024 also contributed to the growth and consolidation of the cybersecurity market.
