Google to buy cybersecurity firm Mandiant for $5.4 billion

• If the deal goes through, it will be Google’s second-largest acquisition

• Search giant said it will pay $23 for each share of Mandiant

Alphabet Inc’s (NASDAQ: GOOGL) Google on Tuesday said it is buying cybersecurity firm Mandiant Inc (NASDAQ: MNDT) for $5.4 billion as part of an effort to better protect its cloud customers.

In the wake of cyberattacks, the deal will help improve Google’s cloud computing business, which generates more than $19 billion annually.

Microsoft Corp (NASDAQ: MSFT) was also said to be discussing buying Mandiant, according to news reports published earlier last month.

The Mountain View search giant offered to pay $23 for each share, representing a premium of nearly 20% to Mandiant’s last Friday closing price.

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The share of the cyber security company jumped over 16% on Monday, over news reports saying that Google is planning to acquire Mandiant.

Mandiant fell over 3.5%, while Alphabet rose over 1% on Tuesday.

Google’s second-largest acquisition

If the deal gets approved by regulators, it will be Google’s second-largest acquisition ever behind the $12.5 billion Motorola deal in 2012.

Mandiant focuses on strategic cyber security advisory and cyber-incident response services.

The company became a standalone entity last year when FireEye Inc, which acquired Mandiant in 2013, sold its products business and the FireEye name for $1.2 billion to a consortium led by private equity firm Symphony Technology Group.

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FireEye was credited with helping Microsoft discover the SolarWinds hack that attacked government systems last year.

Mandiant has also investigated cyberattacks, including recent breaches at News Corp (NASDAQ: NWSA) and Nvidia Corp (NASDAQ: NVDA).

On Monday, a Goldman Sachs economist in a research paper said cyberattacks are expected to cause damage of about $1 trillion to the global economy each year and warned that an escalation in the Russia-Ukraine crisis could trigger “malicious cyber activity” with the possibility to inflict high economic and social costs.

Picture Credit: HPCWire