Investcorp catches FishNet

The Bahrain-based firm has acquired North America’s largest information security provider after a couple months that saw it realise more than $1bn in investment proceeds.

Bahrain-based Investcorp has bought a majority stake in FishNet, America’s largest security integrator and service provider. Terms of the transaction were not disclosed. 

Created in 1996, FishNet buys products from various information security providers – such as Cisco, Trendmicro or McAfee – which it then integrates and markets to corporate clients. It is the largest such provider in America by sales and revenues. 

The company has successfully maintained a double digit growth rate over the last five years, Hazem Ben-Gacem, partner at the firm, told Private Equity International. It was previously owned by Chicago-based Lake Capital and the management team, led by CEO Gary Fish.

Investcorp saw the rise of online security threats as fertile ground to develop FishNet, Ben-Gacem said. “Internet is now one of the largest hubs for organised crime: the value of organised crime online today is larger than the drug trade. Corporates are very aware of these risks. They need to protect not just data but also the day-to-day running of their businesses.”

The firm now intends to take FishNet across the pond – by pushing it through a phase of internationalisation. “The threat and the challenges that a CTO [Chief Technology Officer] has for a business in Arkansas are exactly the same as the ones a CTO based in Lyon has. IT and security software are not a local phenomena, they’re a very international concept.”

The deal comes only a few days after Investcorp sold CCC Information Services to Los Angeles-headquartered Leonard Green and Partners, which has reportedly brought more than $550 million in proceeds to the firm. The firm also sold truck and trailer parts distributor FleetPride to TPG for more than $1 billion in November.

Taken together, both sales have allowed Investcorp to generate more than $1 billion in investment proceeds over the last two months, a statement released after the CCC sale said. 

They also follow a very active year for the firm in Europe, where Investcorp made forays via investments in Georg Jensen, a Danish luxury retailer, and Esmalglass, a Spanish ceramic and enamel producer. 

FishNet was a joint acquisition of Investcorp Technology Venture III, the firm’s dedicated tech fund, and Investcorp Private Equity 2007 Fund, its buyout arm. Technology Venture III makes investments of between $30 million and $50 million, and partners up with its sister fund when the target size exceeds the higher end of the bracket.