Proofpoint Acquisition: Key Details, Impact, and What Comes Next

Thoma Bravo's acquisition of Proofpoint, valued at $12.3 billion, marks a significant move in the cybersecurity industry. This transaction underscores the growing importance of advanced threat protection and compliance solutions. By becoming a private company, Proofpoint is poised to leverage Thoma Bravo's expertise and resources, enhancing its ability to address evolving cyber threats and expand its market presence.

What Is Proofpoint?

Founded in 2002, Proofpoint specializes in cybersecurity solutions with a focus on protecting people from human-targeted threats. Its core products include Threat Protection, Email Security, User Protection, Impersonation Protection, and Data Security Posture Management. Proofpoint differentiates itself with a human-centric approach and AI-based detection technologies, offering a comprehensive platform that addresses the full spectrum of security needs. Trusted by numerous Fortune 100 companies, Proofpoint is recognized for its leadership in the cybersecurity industry.

Who Acquired Proofpoint?

Thoma Bravo is a leading private equity firm specializing in software and technology investments. With over 40 years in the industry, the firm focuses on providing capital and strategic support to technology companies. Thoma Bravo's key services include strategic growth investments in sectors like IT management, cybersecurity AI, and edtech platforms. Managing assets worth over $179 billion, the firm has a significant market presence with over 75 current portfolio companies and approximately 520 completed transactions.

When Was Proofpoint Acquired?

Thoma Bravo completed its acquisition of Proofpoint on August 31, 2021. This acquisition, valued at $12.3 billion, was initially announced on April 26, 2021, and approved by Proofpoint's stockholders on July 23, 2021. The timing of this acquisition is significant as it aligns with the increasing importance of cybersecurity due to the rise in cyberattacks and data breaches, especially accelerated by the COVID-19 pandemic and the shift to remote work.

Why Was Proofpoint Acquired?

• Market Expansion: The acquisition allows Proofpoint to leverage Thoma Bravo’s expertise to drive significant growth and offer protection to more customers as a private company. This move provides Proofpoint with the flexibility and resources to continue providing effective cybersecurity and compliance solutions globally, accelerating its growth and market reach.
• Technology Integration: Proofpoint is expected to build on its offerings to continue preventing, defending, and responding to cybersecurity threats. Thoma Bravo’s deep cybersecurity expertise and operating capabilities will help propel Proofpoint’s continued innovation and growth, enhancing its advanced threat protection and email security technologies.
• Competitive Advantage: Proofpoint’s people-centric security and compliance strategy, along with its innovative product suite, positions it to drive significant growth and offer enhanced protection to customers. Thoma Bravo’s experience in investing in software companies and its approach to value creation further strengthen Proofpoint’s competitive advantage in the cybersecurity market, making it more valuable for future opportunities.

Acquisition Terms

• Acquisition Price: Approximately $12.3 billion in cash.
• Payment Method: All-cash transaction.
• Key Conditions or Agreements:
  • Proofpoint shareholders will receive $176.00 per share in cash.
  • The transaction includes a 45-day "go-shop" period, allowing Proofpoint to solicit alternative acquisition proposals until June 9, 2021.
  • The transaction is subject to customary closing conditions, including approval by Proofpoint shareholders and receipt of regulatory approvals.
  • Proofpoint's Board of Directors has unanimously approved the agreement and recommends that shareholders vote in favor of the transaction.
  • Upon completion, Proofpoint will become a private company, and its common stock will no longer be listed on any public market.
  • The transaction is expected to close in the third quarter of 2021.

Impact on Proofpoint

The acquisition of Proofpoint by Thoma Bravo has led to significant changes in the company's operations and management. Proofpoint's common stock has ceased trading on the Nasdaq, marking its transition to a private entity. This shift allows Proofpoint to benefit from Thoma Bravo's deep cybersecurity expertise and capital support, fostering an environment for innovation and growth. The company will continue to be headquartered in Sunnyvale, California, and is expected to maintain its focus on delivering advanced threat protection and compliance solutions.

Regarding product offerings and services, the acquisition is anticipated to enhance Proofpoint's ability to innovate and expand its cybersecurity solutions. The increased flexibility and resources from Thoma Bravo will enable Proofpoint to stay ahead of evolving cyber threats. Employee reactions have been positive, with CEO Gary Steele acknowledging their hard work and commitment. While direct customer reactions are not detailed, the acquisition promises continued innovation and robust protection, likely reassuring Proofpoint's extensive customer base. For founders considering business transitions, tools like Sunset can assist in managing such processes compliantly and efficiently.