Imperva Said to Draw Acquisition Interest From Cisco, IBM

(Bloomberg) -- Imperva Inc., the security-software company working with Qatalyst Partners to find a buyer, has drawn interest from companies including Cisco Systems Inc. and International Business Machines Corp., people with knowledge of the matter said.

Forcepoint, jointly owned by private equity firm Vista Equity Partners and Raytheon Co., also is interested in acquiring Imperva, said two of the people, who asked not to be identified because the information is private. Bids are due in about two weeks, one person said.

Imperva climbed less than 1 percent to $43.39 Thursday in New York, giving it a market value of about $1.4 billion. The shares jumped as much as 17 percent in after-hours trading.

Last month, Imperva said it hired boutique M&A advisory firm Qatalyst to perform a “comprehensive review of strategic alternatives” after being targeted by activist investor Elliott Management Corp.

Imperva, based in Redwood Shores, California, supplies threat detection, breach prevention and other data-protection products for industries including health care, financial services and for the government. Akamai Technologies Inc., based in Cambridge, Massachusetts, and Sunnyvale, California-based Fortinet Inc. also have held discussions with Imperva, the people said.

A spokesman for Imperva declined to comment. Representatives for Armonk, New York-based IBM, San Jose, California-based Cisco, Akamai and Fortinet all declined to comment. A representative of Forcepoint didn’t immediately respond to an e-mailed request for comment.

Network Security

Under Chief Executive Officer Chuck Robbins, Cisco is trying to reshape its product offering to meet the changing demands of computer networking. Network security is one of the key components of his strategy to better align offerings to customers who are increasingly using the cloud over fixed hardware and software.

Security software has also been one of IBM’s newer focuses in its efforts to seek fresh areas of growth amid declines in other businesses. IBM has previously made a number of acquisitions to bolster its security offerings, including Resilient Systems Inc. in April. IBM topped $2 billion in security revenue last year.

Activist Elliott disclosed in a June 13D filing that it had amassed 9.8 percent of Imperva and started a dialogue with the company’s board about “strategic and operational opportunities.” As of June 28, Elliott had increased its stake to 10.9 percent, according to an updated regulatory filing.

Security companies have become hot acquisition targets of large enterprise firms as companies including Sony Corp., Target Corp. and JPMorgan Chase & Co. have all had high-profile data breaches in recent years.

Yahoo! Inc. said Thursday the personal information of at least 500 million users was stolen in an attack on its accounts in 2014, exposing a wide swath of its roughly 1 billion users ahead of Verizon Communications Inc.’s planned acquisition of the web portal’s assets.

--With assistance from Ian King and Jing Cao To contact the reporters on this story: Alex Sherman in New York at asherman6@bloomberg.net, Beth Jinks in San Francisco at bjinks1@bloomberg.net. To contact the editors responsible for this story: Elizabeth Fournier at efournier5@bloomberg.net, Elizabeth Wollman, Devin Banerjee