Arctic Wolf has acquired BlackBerry’s troubled cybersecurity business, Cylance, for $160 million. This is a significant amount compared to the $1.4 billion BlackBerry paid to acquire the company in 2018.
Under terms of the transaction, which is expected to close in the fourth quarter of BlackBerry’s fiscal year, BlackBerry will sell its Cylance assets to Arctic Wolf for $160 million in cash. BlackBerry will receive approximately $80 million at closing, the remainder a year later, and approximately 5.5 million shares of Arctic Wolf’s common stock.
“We view this transaction as a win-win for our shareholders and all other stakeholders,” BlackBerry CEO John Giammatteo said in a statement. “Our customers will realize the benefits of service continuity and expertise provided by a global cybersecurity leader like Arctic Wolf. Arctic Wolf benefits from adding Cylance’s endpoint security solutions to its base platform. Finally, as Arctic Wolf leverages its scale to grow based on its Cylance business, BlackBerry will benefit as a portfolio reseller to large government customers and as a shareholder in the company.”
About eight years ago, BlackBerry, once known for its keyboard-sporting smartphones, proposed acquiring Cylance as a key component of its shift toward enterprise services. This was BlackBerry’s largest all-cash M&A deal to date, and Cylance integrated its technology with BlackBerry’s existing platform but continued to operate largely as a standalone business unit.
But Cylance, founded in 2015 by former McAfee and Intel duo Stuart McClure and Ryan Permeh, has struggled to maintain a foothold in an increasingly crowded cybersecurity sector. The company’s AI-based cyber threat analysis software has gradually lost out to competitors. Cylance’s 2022 endpoint security market share was just 1.3%, according to IDC. (Endpoint security refers to protection for devices such as desktops, laptops, and mobile devices.)
Cylance also inflicted heavy losses on BlackBerry’s broader cybersecurity division, posting a record $51 million loss for the fiscal year ending February 28, 2025. Earlier this year, BlackBerry CFO Tim Foote said the company would shift spending in Cylance and other segments. Growing more profitable business units, such as the secure communications business, is an expensive business.
In a blog post, Arctic Wolf CPO Dan Schiapa called Cylance’s approach to endpoint security “fundamentally unique” and allows Arctic Wolf to bring “innovative, scaled, and sophisticated endpoint security solutions” to the market. He said it would happen.
“For Cylance customers, not only will the endpoint security products they use every day continue to be fully supported, but they will also benefit from Arctic Wolf’s resources and expertise,” said Schiappa. “Endpoint security is a top priority for us as a company, and as one of the leading platform companies in cybersecurity, Arctic Wolf can provide the resources, innovation and expertise needed to take Cylance’s endpoint products to the next level. Equipped with special equipment. .”
Cylance is Arctic Wolf’s sixth acquisition since its founding in 2012. The company’s other acquisitions include security intelligence platform RootSecure, threat hunting platform Rank Software, security training startup Habitu8, digital forensics company Tetra Defense, and security orchestration software developer Revelstoke.
