Private equity giant Thoma Bravo has announced that its security information and event management (SIEM) company Logrhythm will merge with rival cybersecurity firm Exabeam, which is backed by Cisco, Lightspeed Venture Partners and others.
SIEM is a business that uses real-time data collected from servers, network devices, and applications to flag anomalous activity and stop potential security threats before they spread. Integration within spaces is rampant. News of the LogRhythm and Exabeam merger comes on the same day that Palo Alto Networks confirmed it would acquire the assets of IBM's SIEM business QRadar, which IBM itself acquired in 2011. This also follows Cisco's blockbuster $28 billion deal to acquire SIEM giant Splunk. The deal closed in March.
More broadly, the cybersecurity field is rife with M&A activity. Earlier this month, Akamai revealed that he would acquire his API security company Noname for her $450 million. Permira bought a majority stake in digital fraud detection startup BioCatch at a valuation of $1.3 billion. And Thomas Bravo reared his head again, taking cybersecurity company Darktrace private in a $5 billion deal.
Elsewhere, cloud security platform Wiz has raised $1 billion in funding for a staggering $12 billion valuation, and the investment will essentially be used to scoop up other cybersecurity startups. .
Logrhythm had raised about $126 million before Thoma Bravo swooped in in 2018 and acquired a majority stake for an undisclosed amount. Meanwhile, Exabeam raised total funding of nearly $400 million with a $200 million Series F round in 2021. Thoma Bravo did not disclose Exabeam's valuation in the merger. Exabeam was previously valued at $2.4 billion. However, many companies' valuations have plummeted due to the massive post-pandemic correction. Exabeam faced some challenges. For example, this Reddit post of his details his layoffs six months ago.
As in almost every field these days, AI is playing an increasingly important role in cybersecurity, and according to LogRhythm CEO Chris O'Malley, Exabeam offers “AI-driven security solutions.” is.
“Our expertise and shared strategic vision will work together to accelerate innovative AI-driven cybersecurity solutions for customers around the world,” O'Malley said in a statement. “Alert CISOs have been looking forward to the emergence of a strong, customer-focused, singularity-focused global leader in AI-driven security operations. We offer the best alternative to complex options. The day has come.”
Thoma Bravo said it expects the merger to close in the third quarter of 2024.