Thales to buy Imperva in $3.6 bn cybersecurity deal

French multinational company Thales has announced its plans to acquire Imperva, a leading U.S. cybersecurity firm, in a deal valued at $3.6 billion. The move marks a significant expansion outside Thales’ traditional defense business and represents a strategic step in the fight against cyber threats posed by bots and hackers.
ThalesImperva’s presence in the United States, serving some of the largest companies in the region, presents a valuable opportunity for Thales to bolster its digital identity and security (DIS) division and gain a larger market share in the American cybersecurity landscape.

The acquisition, which comes from buyout firm Thomas Bravo, indicates Thales’ commitment to investing substantial sums to fortify its DIS division and cement its position in the U.S. market. The purchase price implies an enterprise value of 17 times the 2024 operating earnings forecasts, highlighting Thales’ dedication to reinforcing its capabilities in the cybersecurity sector.

Nicolas Arpagian, vice-president at cyberconsulting firm HeadMind Partners, commented on the acquisition, noting the significant investment and the challenge of integrating a dynamic software-based asset. He emphasized the need for well-trained personnel to manage and adapt the software effectively.

Thales projects that the purchase of Imperva will result in approximately $110 million in pretax synergies, including $50 million in cost savings and an additional $60 million linked to revenue opportunities. The combined business is expected to generate proforma revenues of 4.5 billion euros in 2024, with further growth to 5.4-5.5 billion euros by 2027.

In defense of the acquisition’s price, Thales clarified that it was paying 6.1 times sales for Imperva, which had been acquired by Thomas Bravo at a multiple of five times and subsequently turned into a profitable venture.

Patrice Caine, CEO of Thales, expressed confidence in the valuation and highlighted the transformative impact the acquisition would have on the company’s presence in civil cybersecurity.

Cybersecurity concerns have become a top priority for corporate executives worldwide, as cyberattacks continue to escalate. A recent survey by PwC revealed that global corporate executives consider cyber threats as their primary concern. Last year, France established a dedicated campus near Paris to address hacking challenges.

Thales anticipates that the acquisition of Imperva will significantly boost its earnings per share in the medium term and contribute close to $500 million in additional revenue. Talks between Thales and Thomas Bravo began in the first quarter and accelerated over the past three months, culminating in the announcement of the acquisition.

The deal is Thales’ most substantial acquisition since its purchase of digital identity company Gemalto in 2019 for $5.6 billion. The company expects the transaction to close in 2024, subject to regulatory approvals, and foresees no significant obstacles.

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