U.K. Email Security Firm to Go Public in U.S.

Mimecast's IPO comes as businesses seek to secure their computer networks following a string of high-profile data breaches.
Matthew HellerOctober 19, 2015

Britain’s Mimecast Ltd. has filed for an initial public offering in the U.S. in a move to capitalize on investor interest in data security firms.

Mimecast provides secure email services for companies and generated revenues of $116 million last year. It is aiming to raise up to $100 million through the IPO, which could value it about $1 billion.

As Reuters reports, cybersecurity firms have been looking to go public as more businesses seek to secure their computer networks following a string of high-profile data breaches at Sony, JPMorgan Chase, and Anthem.

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Shares of Rapid7 Inc., which helps businesses assess and monitor security risks, opened at $26.75, above the IPO price of $16 per share, in their debut on July 17.

“As a result of the widespread impact of phishing attacks, the disruption of spam and the magnitude of recent data breaches, organizations are elevating the priority of IT security projects,” Mimecast said in its registration statement with the U.S. Securities and Exchange Commission.

Spending on enterprise information and email security, continuity and archiving was $9.4 billion in 2014 and will grow to $11.6 billion in 2017, according to the statement.

Mimecast, which was founded in 2003, has 14,500 customers including software maker NetSuite and advertising giant Omnicom Group. Although the U.K. is still its biggest country by employees, the company plans to list on Nasdaq, where it would trade alongside rival security software developers Proofpoint and Rapid7.

“Well organized and funded, including state-backed, hackers and cyber-criminals are using email-based attacks to target organizations to disrupt their operations, steal sensitive corporate data and gain access to valuable intellectual property,” Mimecast said.

The company said that, among other risk factors, data security and integrity are “critically important” to its business, and “breaches of our information and technology networks and unauthorized access to a customer’s data could harm our business and operating results.”

Mimecast said in September it was the victim of a cyber attack that prevented some U.S. customers from accessing email.