Cisco Systems will buy cybersecurity services provider Sourcefire for about $2.7 billion in cash.
Cisco and Sourcefire will combine their products, technologies and research teams to provide advanced threat protection across the entire attack continuum.
In a 16 July 2013 note, ABI Research said cyber security spending for critical infrastructure will touch $46 billion globally by the end of 2013.
Cisco’s acquisition strategy reflects ABI Research’s report that says increased spending over the next five years will be driven by a number of policies and procedures in education, training, research and development, awareness programs, standardization work, and co-operative frameworks among other projects.
The deal is Cisco’s biggest since its $5 billion acquisition of NDS Group last year.
Sourcefire, founded in 2001, has reported revenues of $223.1 million, an increase of 35 percent year-over-year. The company has more than 650 employees worldwide.
Cisco said that adding Sourcefire would give it a portfolio of next-generation security offerings.
Intel-owned McAfee recently said cybercrime loss to the global economy is between $100 billion and $500 billion.
“Sourcefire aligns well with Cisco’s future vision for security and supports the key pillars of our security strategy,” said Hilton Romanski, a Cisco vice president for corporate development.
The deal is expected to slightly dilute Cisco’s earnings for its 2014 fiscal year. Upon completion of the transaction Sourcefire employees will join the Cisco Security Group led by Christopher Young.
Cisco is trying to play a larger role in the security market. China’s estimated $4.9 billion IT security market could double by the year 2017, according to a new ABI Research report.
Analysis indicates that the global cyber security market is set to be worth $68.34 billion in 2013, as exceedingly high-demand continues for information security systems across governments, global militaries, and the private sector.