Hollywood-based Prolexic acquired for $370 million

Hollywood-based cybersecurity company Prolexic Technologies is being acquired by publicly traded Akamai Technologies for $370 million in cash, the companies announced Monday.

Prolexic provides cloud-based security solutions for protecting data centers and enterprise applications from so-called distributed denial of service (DDoS) attacks. Akamai already provides services to defend websites and applications but did not offer a solution for protecting data centers so this will be a “synergistic” and important extension of the company’s security offerings, Akamai CEO Tom Leighton said in a morning conference call with analysts. Today organizations require comprehensive security solutions that address many different protection scenarios, including securing mission-critical web properties and applications from attack, as well as protecting the full suite of enterprise IP applications — including email, file transfers and VPN — across a data center, the companies said.

Prolexic currently serves about 400 customers in a variety of industries, particularly financial services. Jim Benson, CFO of Akamai, would not disclose Prolexic’s 2012 revenues or growth rate, but said Akamai expects “rapidly growing” Prolexic to be “roughly a $50 million revenue business this year.”

Under terms of the agreement, Cambridge, Mass.-based Akamai will acquire all of the outstanding equity of Prolexic in exchange for a net cash payment of approximately $370 million, after expected purchase price adjustments, plus the assumption of outstanding unvested options to purchase Prolexic stock.

The transaction, subject to regulatory approvals, is expected to close in the first half of 2014. The deal is one of the largest for South Florida technology companies this year.

Prolexic, which launched in 2003, has about 200 employees. Leighton said Akamai expects the current management and employees to continue in their roles as part of Akamai after the transaction closes and that the Broward facilities will be Akamai’s third “center of excellence.” Others are in Massachusetts and Israel.

“Today, business is defined by the availability, security and latency of Internet-facing applications, data and infrastructure,” said Scott Hammack, CEO at Prolexic. “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.”

Follow Nancy Dahlberg on Twitter @ndahlberg

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