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April 14, 2016
martinwolf Transaction Analysis
Optiv Security Reportedly To Seek IPO In 2016
 
Financial Information
  • Undisclosed

Transaction Facts

  • According to a report published in Bloomberg on Wednesday, Optiv Security has hired Goldman Sachs and Morgan Stanley to prepare it for an initial public offering later this year.
  • Formed by the merger of Accuvant and FishNet Security in early 2015, Optiv is a portfolio company of Blackstone Group (NYSE:BX) and has grown from $1.5 billion in revenue following the merger to $2.0 billion by the end of 2015.
  • Planning is still in its initial phases - according to the article, timing would depend on current market conditions and investor demand.

A Proven Path, If Uncommon Today

  • Using Private Equity to Go Ultimately Public: Both of Optiv's predecessors leveraged private equity resources to position themselves for their combination. FishNet Security was backed by InvestCorp, while Accuvant was backed first by Sverica and then later by Blackstone (which maintains a significant position in Optiv today).
  • Dormant but Not Dead: The IPO market today is considerably more sparse than in recent years, with Q1 2016 experiencing the poorest showing since 2009. Only 10 US IPOs occurred, all of them in the healthcare space. But the market is showing signs of life - Dell's SecureWorks is aiming to raise up to $158 million in an IPO next week.
  • VAR and Few Between: IPOs are especially uncommon in the VAR space. While Optiv is working to transform its offerings to emphasize its services capabilities, at its core it remains a VAR - making this potential IPO even more remarkable.
  • Cybersecurity Remains a Hot SpaceCybersecurity has continued to be a hot space with new debates over encryption and data protection dominating headlines. Recent market research has pegged the cybersecurity market - worth $75 billion in 2015 - as hitting more than $170 billion in 2020.
For more information about this transaction,  click here to read the report in Reuters.

martinwolf was not the advisor in this transaction.

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