$890 million deal adds to enterprise security offering
Gemalto announced that it has signed a definitive agreement to acquire 100% of the share capital of SafeNet, a provider of data protection and software monetization, from Vector Capital for $890 million on a debt free/cash free basis. The deal is expected to close in the fourth quarter.
Gemalto made the purchase because it wanted to bolster its enterprise security offering, says Paul Beverly, chief marketing officer at Gemalto. The company has dominant market share in the telecom, banking, government and machine-to-machine markets but it wanted to make a move in the enterprise world, or “security at the edge,” Beverly adds.
SafeNet is involved in three primary lines of business, security for the enterprise, digital rights management software and hardware security modules, Beverly explains. The last two will be news lines of business for Gemalto. “This isn’t about buying a small company and stripping them down,” Beverly explains. “We’re taking them and putting them into a business segment where we’ve been underrepresented.”
Gemalto and SafeNet also serve some of the same clients but in different areas, Beverly says. “We’re going to have more products and services that we sell to the same companies,” he adds.
SafeNet is headquartered in Belcamp, Md. and located in 27 countries The company is one of the largest digital information security companies in the world, trusted to protect, control the access to and manage sensitive data and high value software applications. As an example, SafeNet technology protects more than 80% of the world’s intra-bank fund transfers and its 1,500+ employees, including 550 cryptographic engineers, serve more than 25,000 customers, both corporations and government agencies, in over 100 countries.
Customers utilizing SafeNet solutions include Banamex, Bank of America, Cisco, Dell, Hewlett-Packard, Kaiser Permanente, Netflix, Starbucks and many more of the world’s best known companies.
In 2013, SafeNet recorded revenues of $337 million and profit from operations of $35 million and expects revenues of $370 million and profit from operations of $51 million for 2014. As Gemalto enters into its 2014-2017 multi-year development plan, the digital world enters a period in which proper control over sensitive information is paramount.