Clearwater completes CynergisTek cybersecurity deal
Healthcare-focused cybersecurity and risk consulting firm, Clearwater Compliance has completed its acquisition of CynergisTek, an Austin, Texas-based cybersecurity consultancy. This brings together two market leaders who will join forces to serve the cybersecurity, privacy, and compliance needs of healthcare organizations and organizations in other highly regulated industries. As a result of the acquisition, CynergisTek is now a privately owned company operating as a subsidiary of Clearwater, alongside Clearwater’s recently acquired TECH LOCK Division. The three companies have a similar mission, values, and focus on their customers. This provides them with an opportunity to create one clear market leader in healthcare cybersecurity compliance.
“We are incredibly excited about creating a larger, more scaled organization that is even better positioned to support our customers and proactively address their cybersecurity and compliance needs,” said Steve Cagle, Clearwater CEO. “Ransomware attacks and breaches continue to disrupt the delivery of quality patient care and cost the healthcare industry hundreds of millions of dollars. At the same time, the processes of identifying risks on an ongoing basis and establishing and executing effective cybersecurity programs continue to grow in complexity. Our customers need capabilities to effectively prevent, detect, and respond to cybersecurity attacks.”
“We have made tremendous strides in expanding our service offerings over the years,” Mac McMillan, president, and CEO of CynergisTek. “We believe that merging Clearwater and CynergisTek as a private company will allow the combined entity to be more agile with greater flexibility to continue investing in innovation with the opportunity to scale as a Managed Service Provider (MSP) expanding and enhancing its service portfolio.”
Clearwater had announced in May, an agreement to purchase all of CynergisTek’s common stock for $1.25 per share which would amount to $17.7 million in total. The majority of CynergisTek’s stockholders approved the merger deal on August 31 and the deal got finalized the following day. With the completion of the transaction, Mac McMillan, Tim McMullen, and Paul Anthony (CFO of CynergisTek) will leave CynergisTek following a transition process. The rest of the CynergisTek management team will remain an important part of the combined company’s management team.
According to a report by SS&C Intralinks, cybersecurity mergers and acquisitions (M&A) activity boomed in 2021 and set a record deal with over USD 50 billion deal value which is the highest since 2016. North America has been the hub of cybersecurity deal activity due to several factors like the size of its economies and the concentrated presence of MANGA companies that operate both domestically and abroad. The deal value in North America grew 108.9% between 2020 and 2021 and the deal count rose 38.5%. Read more here.
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