Bloomberg

SuperCom (Nasdaq: SPCB), seller of secure-ID and secure payment solutions, has acquired Safend Ltd., provider of encryption and data theft protection software.

As a part of the deal, SuperCom will provide Safend with up to $1.5 million of working capital through a structured debt and equity vehicle. Safend was a division of Wave Systems Corp., a Cupertino, California, company that filed on Feb. 1 for liquidation under Chapter 7 of federal bankruptcy law.

Safend provides protection against theft and loss of data through information mapping and data flow control techniques employed through email, web, external devices and other channels. Supercom’s CEO, Arie Trabelsi, says the acquisition will help his company by bringing in new technology, security experts and customers, strengthening SuperCom’s cyber and data protection capabilities, particularly with its government clients, Internet-of-things business and secure payments services. Both companies are based in Israel—SuperCom in Herzliya and Safend in Tel Aviv.

Safend, founded in 2003, has more than 3,000 customers in the U.S., Europe and Asia, and more than 3 million software licenses sold to clients, including government agencies and businesses. As part of SuperCom, Safend will continue to provide support, services and upgrades for its data protection brands.

SuperCom’s businesses include digital ID solutions for governments and organizations, secure mobile payments and radio-frequency ID, tagging and tracking solutions, including monitoring devices for livestock and parolees. Wave Systems acquired Safend in 2011 for $12.8 million. According to SuperCom, Safend's average annual revenue in recent years was about $5 million.

Cybersecurity has been a ripe sector for middle-market M&A. In January, cybersecurity firm FireEye Inc. (Nasdaq: FEYE) acquired competitor iSight Partners in a deal that could be worth $275 million. In February, cybersecurity provider Thycotic purchased Arellia, a Windows protection software company that was backed Insight Venture Partners.

Mergers & acquisitions recently hosted a webinar on how cybersecurity threats are driving deals. Panelists included: Eric Feldman, chief information officer, the Riverside Co.; Jason Kaufman, head of Chertoff Capital, the Chertoff Group;  and Scott Stevens, co-head of IT security, William Blair & Co. View the webinar, sponsored by Citrix ShareFile.

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