Google to acquire Mandiant for $5.4B

Google plans to acquire Mandiant for approximately $5.4 billion in an all-cash deal, according to announcements by both companies Tuesday.

The deal marks the second major corporate shift for threat response vendor Mandiant in under a year. Last June, Mandiant and FireEye announced a split that resulted int the sale of the FireEye product line and name to private equity firm Symphony Technology Group for $1.2 billion -- a split that reversed FireEye's acquisition of Mandiant in 2014.

The deal is expected to close later this year, with the valuation -- $23.00 a share -- representing a 57% premium to the undisturbed 10-day trailing volume weighted average price as of Feb. 7, according to Mandiant.

Google said in its press release announcing the acquisition that Mandiant will become part of Google Cloud upon the deal's closure.

"The acquisition of Mandiant will complement Google Cloud's existing strengths in security," the announcement said. "With the addition of Mandiant, Google Cloud will enhance these offerings to deliver an end-to-end security operations suite with even greater capabilities to support customers across their cloud and on-premise environments."

Google also said it was "deeply committed to supporting the technology partners of both companies," calling attention to the endpoint ecosystem, system integrators, resellers and managed security service providers.

In an email to Mandiant employees, CEO Kevin Mandia said the company's discussions with Google "convinced us that this is the best course for Team Mandiant, for our shareholders, for our customers, for our mission, and for the broader community we hope to reach."

"Google Cloud recognizes the capabilities Team Mandiant offers and appreciates the unique approach we bring to today's cyber security battle," he wrote. "They see an opportunity to embrace and invest in what we have created to help advance their commitment to making the world safer."

SearchSecurity asked Mandiant about the timing of the acquisition, which came approximately six months after Mandiant became an independent company again; SearchSecurity's questions were forwarded to a Google Cloud spokesperson, who then declined to comment.

However, in an internal Mandiant FAQ available via an SEC filing, the company provided slightly more context.

"Having completed the FireEye divestiture and made significant progress on our transformation, we were confident in our strategy, our team, and our path forward," it read. "However, once we received Google's offer and understood their shared vision of the future, we had an obligation to consider that offer, along with alternative opportunities. After careful consideration, we concluded that Google's offer is in the best interest of our company, our employees, our stockholders and our customers."

Jon Oltsik, senior principal analyst and fellow at Enterprise Strategy Group, a division of TechTarget, said Mandiant became more attractive as an acquisition target after it was split from FireEye.

"Google has no interest in security technologies like endpoint security, network sandboxes or network security monitoring solutions," he said. "These products had their roots in on-premises IT, which is not where Google Cloud plays. Once Mandiant was spun out, however, it was a standalone, marquee security services provider. Since just about every organization uses security services of one kind or another, Mandiant became more attractive as an acquisition target."

Eric Parizo, managing principal analyst for Omdia Cybersecurity, said he was "very surprised" by the deal, noting rumors that Microsoft was potentially closing in on a deal to acquire Mandiant. In terms of a fit with Google, Parizo called Mandiant's incident response business "a great revenue driver" that could fit well into any acquiring organization.

"It will take the better part of 2022 for everything to come together," he said. "But there's no question the addition of Mandiant's threat detection capabilities, unmatched threat intelligence, as well as some of the best and most talented staff in the industry will very quickly supercharge Google Cloud's cybersecurity capabilities."

Alexander Culafi is a writer, journalist and podcaster based in Boston.