Tufin provides comprehensive information security solutions to organizations, helping them to implement a uniform information security policy in different cloud environments
On April 6, Israeli startup Tufin TUFN announced that it had agreed to be acquired by Turn / River Capital, a software-focused investment and acquisition firm in San Francisco, for $ 570 million in cash or $ 13 per share in cash, representing a 44% premium over the Tufin Arab share price. The announcement of the transaction in the amount of $ 9.03. The transaction is expected to close in the current quarter – the second quarter of 2022. On the first trading day after the announcement, the share of Tuffin rose by more than 40%.
Tufin provides comprehensive information security solutions to organizations, and helps them implement uniform information security policies in different cloud environments. The company’s products set the rules for communication between details, systems and applications, and provide automated information-based information security, so that customers are able to shorten the time to make changes to the organization’s information systems – from days to minutes. Financial advisory firm Cowen, meanwhile, is upholding its recommendation on the stock.
Tufin’s board of directors unanimously approved and recommended the deal, and the company’s CEO and CTO agreed to vote in favor of the deal. A special approval meeting for shareholders will be held in the coming days, and Kwon expects the deal to close in the end.
The transaction includes a 30-day “Go-Shop” period that expires on 5/5/22, which allows the management team of Tufin and its consultants to actively evaluate alternative purchase offers from third parties. We believe that the development and deployment of enterprise-level policy-driven automation to address security threats is an area that should arouse growing organizational interest, especially given the current shortage of skilled IT professionals. These dynamics suggest that a variety of cyber security providers, particularly next-generation firewall providers, may be potential buyers seeking to disrupt the deal. “However at this stage we have no knowledge of rival offers in the works. Despite the recent contraction, cyber security valuation multipliers have remained high. We believe that the valuation of this transaction of 3 times revenue over revenue in 2022 is relatively conservative for this sector.
“We believe that this deal reflects the growing demand for efficient cyber security solutions, especially those that leverage automation, and we believe this may ignite mergers and acquisitions in the space. However, given the unique nature of Tuffin’s solutions, we do not see a specific target to emphasize as a result of this transaction.