SAN FRANCISCO -- Raytheon Co., a U.S. defense contractor and the world's largest maker of guided missiles, revealed April 20 that it is acquiring information security provider Websense Inc. for about $1.9 billion. It then will spin out the acquisition into a new company.
The deal was announced at the RSA Security 2015 conference here at Moscone Center.
When the deal is completed, Raytheon will own an 80 percent stake in the firm. Current Websense owner Vista Equity Partners will retain 20 percent of the company. Websense went private with Vista in May 2013 in a $907 million buyout.
Vista Equity thus made a profit of about $1 billion in the sale to Raytheon after holding Websense for a bit less than two years.
Websense’s security expertise will augment Raytheon's Cyber Product division, which has its own market capitalization valuation of about $400 million. Vista Equity then will invest $335 million in the new cyber-security company.
Websense CEO John McCormack has been asked to lead the new company, which will operate as a subsidiary of Raytheon.
Websense started in 1994 as a security reseller, NetPartners. It changed its name to Websense in 1999, following the success of its software which manages employee Web use. Websense's software blocks websites and enables companies to inspect network traffic and filter emails for security and hacking threats.
In 2000, the company went public at $18 a share, generating $65.7 million in its initial public offering, and announced a 2-for-1 stock split in 2006.
While the company started off focusing on Web content, it transformed into a content-security firm throughout the past decade. In 2010, the company launched its Triton data-security platform, which accounts for an increasing portion of its revenues. In Q1 2013, the company announced profits of $2.8 million, compared with a loss in the same quarter a year earlier, and two-thirds of the revenue came from Triton sales and subscriptions.
Triton APX security intelligence suite offers security solutions that unify Web, email, data and endpoint security with a low total cost of ownership, and is used by tens of thousands of enterprises to stop advanced persistent threats, targeted attacks and evolving malware. It prevents data breaches, intellectual property theft and enforces security compliance and best practices.
Raytheon also bought cyber security firm Blackbird Technologies for $420 million in November 2014.