Military cyber security firm, Raytheon, targets commercial Internet security

Raytheon (NYSE:RTN) has secured a $1.9 billion deal to acquire complementary network security company, Websense Inc (NASDAQ:WBSN), from private equity firm, Vista Equity Partners. Websense will be operated as a joint venture.

Digital attacks against devices and computers both for commercial and military purposes are increasing. Raytheon Corp., principally focused on the military and defense area hopes to become a gateway against any and all such attacks. By acquiring Websense, it is horizontally stamping its presence outside its traditional domain. Websense on the other hand has conventionally been a company focused on civilian and commercial security grade systems. Its products analyze corporate data for threats including for malicious emails, corrupted internet sites and breach of corporate firewalls.

It is believed in the corporate arena that this deal will accelerate Raytheon’s efforts to offer “defense-grade” cyber solutions to civil and commercial customers while generating growth rates and increasing profits that were accounted for by its military hardware markets.

David Wajsgras, the president of Raytheon’s intelligence, information and services business, is quoted as saying:

“Today’s enterprises are more vulnerable than ever due to the proliferation of cloud computing, mobile devices, and the Internet of things…
...
Our goal is to provide an integrated defense.”

Connected devices in the cloud.

Credit: Perspecsys Photos on Flickr.

In the “internet of things” devices like computers, smartphones, and sensors will be connected to each other in ways unimaginable before, without human-to-device or device-to-device interaction. A flaw in one area of the network can be exploited by cyber-spies and cyber-criminals.

By partnering with Websense, Raytheon is bringing its expertise in the military arena to the civil and commercial field. The cyber-security security industry is huge. In 2014, it was reported that cyber-crime costs the global economy about $445 billion every year, with the damage to business from intellectual property thefts exceeding $160 billion. Losses connected to personal information, such as stolen credit card data, was put at up to $150 billion.

Raytheon though is not the only company gearing itself in the cyber security market. Last month its rival company, Blue Coat Systems Inc., was acquired by Bain Capital LLC of Boston for $2.4 billion. Blue Coat Systems is known for transacting government contracts. Raytheon is famed for the Tomahawk, Patriot, and Sidewinder guided- missile systems and is a major maker of radar and electronic warfare gear.