Defence giant Raytheon to pay $1 billion for Websense, says report

18.03.2015
Only weeks after reportedly deciding against rejecting a takeover of security firm Blue Coat, US military firm Raytheon appears to have turned its attention to rival middleweight outfit Websense.

So far this is only a report from Bloomberg that cites unnamed sources and it appears no deal has yet been done.

Websense is currently owned by private equity group Vista Equity Partners which is said to value the firm at $1 billion (£650 million). If it manages to sell will be a modest return on the $907 million paid to take it private in May 2013 - a significant premium on its share price at the time.

In recent years, private equity has picked on firms such as Blue Coat and Websense as companies in a booming market that should be doing well but somehow aren't. Websense, which went public during the dot.com boom, turned into a rapidly-growing company before slowing in recent years.

In the UK it is best known for buying local firm SurfControl in 2007. Since the equity buyout there have also been local reports of unease over its support and strategy among the reseller community although it's not clear how deep this runs.

The problems firms founded in the 1990s face is that they are not as attractive to IT giants for takeovers as they might once have been. Today's security industry boom has seen money piling into a range of mostly US startups that have shown greater innovation and energy.

Some established firms have simply been left behind to manage their customer base.

Last week Blue Coat - a previous reported Raytheon target - was finally sold by private equity firm Thoma Bravo to Bain Capital for $2.4 billlion. Websense isn't as big a player as Blue Coat but it's another example of how an older generation of tech is being repackaged for today's troubled but potentially very profitable security era.

(www.techworld.com)

John E Dunn

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