(Reuters) -U.S. cybersecurity firm FireEye Inc said on Wednesday it would sell its products business, including the FireEye name, to a consortium led by private-equity firm Symphony Technology Group for $1.2 billion in cash.<\/p>\n
The deal will separate FireEye\u2019s network, email and cloud security products from its cyber forensics unit, Mandiant Solutions.<\/p>\n
The deal is expected to close by the end of the fourth quarter, the company said.<\/p>\n
FireEye, one of the largest and best-known cybersecurity firms in the United States, also said its board had approved a share buyback program of up to $500 million.<\/p>\n
The company originally acquired Mandiant, founded by Kevin Mandia, who became FireEye\u2019s chief executive, for about $1 billion in early 2014. Mandiant will return as an independent company, focused on cyber-incident response and cybersecurity testing, and will be publicly traded following the deal.<\/p>\n
\u201cWith the separation, you get simplicity, you get focus. Together we\u2019re in a lot of markets,\u201d Mandia said in an interview with Reuters about the sale. \u201cA lot of it really was resource constraint.\u201d<\/p>\n
\u201cFireEye can\u2019t do everything,\u201d he added.<\/p>\n
The purchase of FireEye marks a major turning point in the rapidly evolving U.S. cybersecurity marketplace. The still nascent industry has seen numerous companies bought and merged in just the past several years.<\/p>\n
In March, Symphony also purchased McAfee Corp\u2019s enterprise business division for about $4 billion. Last year, chipmaker Broadcom Inc purchased the enterprise business of Symantec, another major industry player, for about $10.7 billion.<\/p>\n
FireEye has handled many of the most high-profile hacking incidents in U.S. history. It is also recognized for its track record of attributing cyberattacks to specific foreign hacking groups from Russia, China, Iran and North Korea.<\/p>\n
Its clients have included firms like Equifax Inc, Target Corp and Sony Pictures, each of which has dealt with hacking incidents.<\/p>\n
More recently, FireEye was called in to respond when a group of Russian cyber criminals hacked and held for ransom a major U.S. pipeline operator – Colonial Pipeline – leading to gas shortages and price spikes. Less than a week later, Colonial restarted operations.<\/p>\n
For years, FireEye said it had a market advantage because Mandiant was in the field finding new cyberattacks, which informed product updates.<\/p>\n
Mandia and FireEye Chief Financial Officer Frank Verdecanna said that while the two companies had an agreement in place to continue their cyber-threat intelligence-sharing partnership, the acquisition \u201cunlocks\u201d Mandiant and allows it to partner with outside firms such as Microsoft Corp.<\/p>\n
\u201cWe want to be known as unvarnished truth. There is no bias,\u201d Mandia said.<\/p>\n
Verdecanna said that roughly half of FireEye\u2019s existing staff would move to Symphony, while the others would rejoin Mandiant.<\/p>\n
FireEye shares initially fell 4% in after-hours trading after the announcement, but are now trading flat.<\/p>\n