All industries have periods of consolidation, but who would have thought that a storage giant would buy a security corporation? At Compliance and Privacy we have a huge interest in security. And we felt some perspective on the deal would be useful:
Facts:
Cash deal, $28 per share
Adds enterprise identity and access management solutions and encryption and key management software to EMC's expanding, information-centric security portfolio
To be completed late Q3/early Q4
Cyota CEO quit yesterday
Compliance and Privacy's Take:
Enterprise centered deal, consumer authentication assets don't fit well in the EMC portfolio
6X revenue multiple represents a high price for the acquisition; could mean consumer authentication pieces will be sold off
Significant questions about their commitment to a nascent consumer authentication market given their emphasis on enterprise
Attrition already started (Cyota CEO quit already ….more to come)
We're holding a watching brief on this one. So is the American Banker
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