Dell to Acquire SonicWALL

Dell announced today their intention to acquire SonicWALL from equity investor firm Thoma Bravo. Thoma Bravo had take SonicWALL private in 2010. They have also recently had purchased secure web gateway company Blue Coat Systems and taken it private. This acquisition, according to Dell, will enable them to offer customers a broader range of enterprise offerings. SonicWALL revenues for the last 12 months were about $260 million. www.sonicwall.com

“Dell’s distribution, reach, and brand are well-recognized across the industry. This transaction aligns well with Dell’s mid-market design focus and allows us to accelerate growth of our flagship SuperMassive Next-Generation Firewall solutions with Large Enterprise customers,” said Matt Medeiros, president and CEO, SonicWALL. “Additionally, SonicWALL is recognized as a leading security solutions provider for small and medium businesses through our UTM solutions. Dell’s phenomenal breadth and reach into small and midsize companies provides a significant opportunity to expand our customer base.”

Before being taken private by Thoma Bravo, SonicWall’s strengths were in serving the SMB marketplace with advanced network security and data protection solutions. They have expanded their portfolio to include Next-Generation Firewalls (NGFW), providing these in a form factors scalable to the enterprise.

SonicWALL and Palo Alto Networks were the top performers in a recent NSS Labs analysis, the “2012 Next Generation Firewall Security Value Map™” (NGFW). The value map illustrates Block Rate versus Price per Protected Mbps. The SonicWall SuperMassive E10800 and the Palo Alto Networks PA-5020 NGFWs were the “winners”.

http://kensek.blogspot.com/2012/03/sonicwall-palo-alto-networks-top.html

Effect on Product Development for SonicWALL - To the extent Dell leaves the development team intact to do their own thing, disruptions should be minimal.

Effect on the SonicWALL brand - No one has said whether the company name SonicWALL will be going away, yet. . Nothing has been said as to whether Dell will use the McAfee/Intel model of having the company be a wholly owned subsidiary of Dell.

Other products SonicWALL brings to Dell - Besides firewalls, NGFWs, and Unified Threat Management (UTM) solutions, secure remote access, email security, backup and recovery, and policy, and management and reporting. Dell is acquiring a nice set of security solutions.

Effect on the SonicWALL channels - SonicWALL has 15,000 resellers providing global coverage. Dell plans to “take the very best of the SonicWALL channel programs” (sounds like a reduction…..) and combine it with Dell’s PartnerDirect program. Dell’s existing PartnerDirect members will be able to sell SonicWALL solutions.

SonicWALL was a public company until 2010, when Thoma Bravo acquired it for $717 million. Investors and analysts are estimating the purchase price to be between $1 billion and $1.5 billion. Healthy return by Thoma Bravo for a 2-year investment! Dell will be funding the deal with cash.

It would be interesting to hear what they’re saying about this at Palo Alto Networks, Check Point Software Technology, Barracuda Networks, and Juniper Networks. IMHO, the Palo Alto Networks IPO (Initial Public Offering) valuation may drop by a bit.

http://content.dell.com/us/en/corp/d/secure/2012-03-13-dell-sonicwall-acquisition.aspx