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McAfee acquires cloud access security broker Skyhigh Networks

In its first big post-Intel move, McAfee agreed to acquire Skyhigh Networks, a leading cloud access security broker, to strengthen its presence in the cloud security market.

McAfee is acquiring cloud access security broker Skyhigh Networks in an effort to strengthen its cloud security...

portfolio.

Financial terms of the acquisition agreement were not disclosed. The Skyhigh Networks deal marks McAfee's first major acquisition since it was spun off from Intel last year. The chipmaker purchased McAfee in 2010 for $7.7 billion and later rebranded the company as Intel Security. Last year, Intel sold a majority stake in McAfee to private equity firm TPG Capital for $3.1 billion.

Skyhigh Networks, which was founded in 2011, emerged as a leading player in the cloud access security broker (CASB) space and was one of the last remaining stand-alone companies in that market. During that span, Skyhigh earned significant investments from venture capital firms, as well was notable patents for its CASB model.

Since splitting off from Intel, McAfee has identified cloud security as a focal point for the business. During the company's MPOWER Cybersecurity Summit last spring, McAfee CEO Chris Young said endpoint devices and cloud services were the "control points" where enterprises will need to put most of their security efforts in the future.

"McAfee is placing our bets on where we believe those environments are best modernized -- where endpoint and cloud serve as the architectural control points linked by the security operations center with actionable threat intelligence, analytics and orchestration, and enabled by an open ecosystem," Young wrote in an open letter posted Monday. "McAfee started its legacy in endpoint; Skyhigh in cloud."

McAfee said Skyhigh will become part of the company's new cloud security business unit, with Skyhigh CEO Rajiv Gupta running the unit. Gupta wrote in a blog post that joining McAfee will give Skyhigh more resources to invest in its technology roadmap.

Skyhigh earlier this year expanded its CASB model, which had traditionally focused on securing enterprise user connections to third-party SaaS applications, to include infrastructure as a service (IaaS). The company introduced two new products, Skyhigh for Custom Apps and Skyhigh for IaaS Platforms, to extend the company's discovery services and security controls beyond SaaS.

The two companies said the acquisition is expected to close "shortly" following regulatory approvals and the completion of other customary closing conditions.

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Will the addition of Skyhigh Networks make McAfee a serious competitor in the cloud security market? Why or why not?
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