December 2, 2013
Akamai Ramps Up Web Traffic Security With Prolexic Acquisition
Enid Burns for redOrbit.com - Your Universe Online
The Internet is about to get safer. Akamai Technologies just entered into an agreement to acquire Prolexic Technologies in a deal valued at $370 million. Prolexic will add cloud-based security solutions to Akamai's web traffic activities.Neither company is a household name. However, Akamai is well known in the enterprise sector for cloud services in the delivery, optimization and security for online content and business applications. Akamai provides the services that allow web pages to load, videos to stream and music to play smoothly.
Prolexic is a Distributed Denial of Service (DDoS) mitigation provider. The company provides a service designed to absorb large and complex attacks, which have become common as hackers try to flood networks and interrupt service on the Internet.
With the acquisition of Prolexic, Akamai intends to enhance its portfolio of security solutions to help defend enterprise web and IP infrastructure.
"Any company doing business on the Internet faces an evolving threat landscape of attacks aimed at disrupting operations, defacing the brand, or attempting to steal sensitive data and information," said Tom Leighton, CEO of Akamai, in a corporate statement. "By joining forces with Prolexic, we intend to combine Akamai’s leading security and performance platform with Prolexic’s highly-regarded DDoS mitigation solutions for data center and enterprise applications protection. We believe that Prolexic’s solutions and team will help us achieve our goal of making the Internet fast, reliable, and secure."
The acquisition of a security company to enhance a web service company such as Akamai will aid the company's enterprise offerings.
"Akamai's acquisition of Prolexic reflects two basic market realities; 1) continuing efforts among enterprises to migrate their businesses and business processes to the Internet, and 2) the continuing danger to those efforts represented by cyber criminals, IP thieves and hackers," Pund-IT principal analyst Charles King told redOrbit.
"Prolexic's portfolio of application-layer, network-layer and data center security solutions should provide immediate commercial benefits but the bigger story lies in how these assets will help Akamai broaden and deepen its enterprise-focused offerings and services. Overall, the deal should prove beneficial to both companies and their respective customers," he explained.
Once integrated, Prolexic's assets will help Akamai continue to keep web sites and internet services moving smoothly.
"Today, business is defined by the availability, security and latency of Internet-facing applications, data and infrastructure," said Scott Hammack, CEO at Prolexic, in a corporate statement. "Being able to rely on one provider for Internet performance and security greatly simplifies resolution of network availability issues and offers clients clear lines of accountability. We believe that, together, we will be able to deliver an unprecedented level of network visibility and protection."
Akamai will acquire all outstanding equity of Prolexic for a cash payment of approximately $370 million, under the terms of the agreement. As the acquiring company, Akamai will assume outstanding unvested options to purchase Prolexic stock. The transaction is expected to close during the first half of 2014.
Prolexic investors include Camden Partners, Trident Capital and Intel Capital.