Cisco to buy Duo Security for $2.35 billion in cash

Enterprise networking major Cisco is set to acquire US-based Duo Security for $2.35 billion in cash.

The deal is the biggest acquisition for Cisco Systems since its $3.7 billion purchase of business performance monitoring software company AppDynamics last year.

It is also the largest in the cyber security sector since Cisco’s $2.7 billion takeover of Sourcefire in 2013, Reuters reported.

Telecom operator AT&T recently bought AlienVault, a cybersecurity provider for small and medium-size businesses.

Duo had raised $119 million to date from investors such as Lead Edge Capital, Index Ventures, Workday, Redpoint Ventures and True Ventures.Cisco to buy Duo SecurityHeadquartered in Ann Arbor, Mich. Duo Security is providing unified access security and multi-factor authentication delivered through the cloud.

The privately-held Duo Security offers security solution that verifies the identity of users and the health of their devices before granting access to applications – preventing cybersecurity breaches.

Duo Security has more than 12,000 customers globally, including Dresser-Rand, Etsy, Facebook, K-Swiss, Random House, Yelp, Zillow, Paramount Pictures, and more.

Dug Song, who is the co-founder and chief executive officer, will continue to lead Duo Security – post acquisition by Cisco. Duo Security will join Cisco’s Networking and Security business led by EVP and GM David Goeckeler.

Cisco customers will be able to securely connect users to any application on any networked device following the integration of Cisco’s network, device and cloud security platforms with Duo Security’s authentication and access products.

“Duo’s zero-trust authentication and access products integrated with our network, device and cloud security platforms will enable our customers to address the complexity and challenges that stem from multi-and hybrid-cloud environments,” said David Goeckeler, executive vice president and general manager of Cisco’s networking and security business.

The acquisition of Duo Security will:

Extend intent-based networking into multi-cloud environments
Cisco currently provides on-premises network access control via its Identity Services Engine (ISE) product. Duo’s software as a service-based (SaaS) model will be integrated with Cisco ISE to extend ISE to provide cloud-delivered application access control.

Simplify policy for cloud security
By verifying user and device trust, Duo will add identity awareness into Cisco’s Secure Internet Gateway, Cloud Access Security Broker, Enterprise Mobility Management, and several other cloud-delivered products.

Expands endpoint visibility coverage
Cisco’s visibility of over 180 million managed devices will be augmented by Duo’s broad visibility of mobile and unmanaged devices.

Founded in Michigan, Duo has offices in Ann Arbor and Detroit, as well as growing hubs in Austin, Texas; San Mateo, California; and London, UK.

Cisco was advised by Goldman Sachs and Barclays as well as the law firm Fenwick & West. Duo was advised by Qatalyst Partners and law firm Gunderson Dettmer.