Despite instability in global markets, UK security vendor Sophos is to press ahead with plans to float itself on the London Stock Exchange.
A timescale, price and prospectus have yet to be made public, but the company [PDF] has boasted of its track record as one of the most prominent security software outfits, with reported billings for 2006-2007 of $167 million. The intention to float has been one of the industry’s worst-kept secrets in recent months, with speculation putting the value of the company at around £400 million ($800 million).
The rationale is simple, even if the timing is brave.
“Increasingly open corporate networks, device proliferation, and an always-on threat environment mean that security focus has shifted from protecting the network perimeter to protecting the endpoint. Complex individual product strategies are being replaced by simple and coherent suites of products,” an official release stated.
This is another way of saying that security is still a boom market, and protection of the troublesome endpoint – the PC for the most part – is still to the fore, just as it always has been since the beginning of software security.
More importantly, the big spenders on security are in the US, and an IPO raises a company’s profile on that market. Earlier this year, recently-appointed CFO Paul Smolinski was quoted as saying to a third party that the company’s attempts to break into the lucrative US market were hampered by its lack of profile there. “They already have 100 security companies and many of them are already listed,” he said wistfully.
Public offerings of UK security companies are few and far between, perhaps the last major one being nCipher, engineered by its high-profile CEO, Alex van Someren, in 2000.