Business
Accenture Announces $4.1B Cybersecurity Deal, Shares Fall on Forecast Cut
Accenture has announced a $4.18 billion cybersecurity deal that includes a majority stake in Dragos and the full acquisition of runZero and NetRise. The acquisitions will strengthen the company's cybersecurity business across industrial operations and critical infrastructure. However, Accenture also lowered the upper end of its annual revenue growth forecast, causing its shares to fall. The acquired companies generate a combined annual recurring revenue of $208 million and are expected to join Accenture later this year, subject to regulatory approvals.
Accenture has agreed to acquire cybersecurity companies Dragos, runZero and NetRise for $4.18 billion as it continues to build out its cyber defence capabilities. The company has long been focused on cementing a larger foothold in security and critical infrastructure resilience, and unveiled the announcement.
Accenture Expands Cybersecurity Operations
The acquisitions will help Accenture grow its cybersecurity business into industrial operations and critical services including power grids, pipelines, factories and data centres. They said the move is driven by an increase in AI-powered cyber threats and tension between powers in the Asia-Pacific region.
The acquisitions from December 2022 and January of this year are due to be completed in August or September, subject to regulatory approvals. The acquired companies collectively have annual recurring revenue of $208 million and will complement Accenture’s existing $10 billion cybersecurity business.
Stock Drops After Reducing Revenue Forecast
Shares of century were down more than 11% in premarket trading after the management introduced the upper end of its annual revenue growth guidance. Business is continuing to be cautious of the economic outlook and therefore they aren’t spending as much on non-essential IT consulting projects, the company said.
Annually, Accenture is now expecting revenue growth of 3% to 4%, compared with its prior guidance of 3% to 5%. It similarly expected fourth-quarter income within $17.75 billion to $18.4 billion, beneath examiners’ normal assessment of $18.47 billion.
FAQs
What companies is Accenture acquiring?
Dragos, runZero and NetRise.
How much is the deal worth?
These acquisitions amounted to a total of $4.18 billion in the billed amount.
Why did Accenture shares fall?
The company lowered its annual revenue growth forecast at the high end.
When are the closing dates for these deals?
The transactions are subject to approvals, but both are expected to close in August / September.
Source: Reuters
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