Cisco Systems CSCO recently completed the acquisition of network security provider Lancope, Inc. The $452.5 million cash and stock deal was announced in October.
Lancope will be incorporated into Cisco's Security Business group under the latter’s senior vice president and general manager, David Goeckeler.
Alpharetta, GA-based Lancope is a privately held network security company. It provides network visibility and security analytics to companies for faster threat identification and incident response.
Cisco will be able to leverage Lancope’s continuous network visibility, specialized threat analysis and protection to enhance its Security Everywhere strategy. The deal will enable its customers to monitor, detect, analyze and respond more efficiently to modern security threats toward enterprise networks.
The acquisition comes at a time when the Internet security market is evolving rapidly. As cloud computing and mobile devices of various kinds flood the market, the need for secure networks to transfer data and related services will also grow proportionally. Moreover, enterprises are looking for integrated hardware/software/services solutions to deal with security threats. This is the area that the networking equipment maker is targeting with this endeavor.
For several years, Cisco has been trying to expand its security portfolio through in-house development. Lancope is its third cybersecurity acquisition this year. In October, the company announced plans to take over consultancy firm, Portcullis, to boost the security consulting services. In August, Cisco bought OpenDNS — a cloud-based security company — for $635 million. It has also completed several other acquisitions such as Neohapsis, Sourcefire, Cognitive Security and ThreatGrid to bolster its security service business.
We believe that this acquisition will broaden Cisco’s customer base and network offerings, while ensuring a significant competitive edge.
Cisco currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry are Extreme Networks Inc. EXTR, Lantronix, Inc. LTRX and Silver Spring Networks, Inc. SSNI, sporting a Zacks Rank #1 (Strong Buy).
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