September 16, 2015
Portico Capital Securities LLC is pleased to announce that it served as the exclusive financial adviser to Coalfire on its majority recapitalization by The Carlyle Group and The Chertoff Group. “We are delighted to have worked with Coalfire on this transaction,” noted S. Searcy Dryden, General Partner at Portico Capital. “As the increasing frequency, size, and magnitude of cyber incidents continue to put our IT systems at risk, Coalfire is the leading independent provider of cyber risk and compliance management services. Partnering with the reach, experience, and resources of The Carlyle Group coupled with the deep industry expertise and global network of The Chertoff Group will enable Coalfire to accelerate its already impressive growth.”
Below are more details from the Company’s press release:
The Carlyle Group and The Chertoff Group Acquire Majority Stake in Coalfire Systems
Investment to Fuel Innovation and Growth at Cybersecurity Service and Technology Provider
Washington, DC – Global alternative asset manager The Carlyle Group (NASDAQ: CG) and The Chertoff Group, a global security and risk management advisory firm, today announced they have acquired a majority stake in Coalfire Systems, Inc.
Founded in 2001 and based in Louisville, Colo., Coalfire is a global cybersecurity and technology services provider specializing in cyber risk advisory, compliance assessments, technical testing and software services for private enterprises and government organizations. With its technical depth and breadth of IT services, Coalfire serves clients in sectors including technology, retail, payments, healthcare, financial services, education, local and state government, and utilities. In the last two years alone, more than 60 of the FORTUNE 500 have come to rely on Coalfire to define their roadmap for technology implementation, meet compliance mandates, and test the efficacy of their processes and technologies. Coalfire has 300 employees in the United States and United Kingdom.
Brooke Coburn, co-head of Carlyle’s U.S. middle-market fund, said, “Cyber risk is an executive- and board-level matter. Organizations need a trusted advisor like Coalfire to effectively assess security risk and evaluate the effectiveness of cybersecurity strategies. In partnership with the company’s exceptional management team, we and The Chertoff Group will harness Coalfire’s outstanding reputation and capabilities to help clients counter advancing cybersecurity threats.”
Coalfire CEO Larry Jones said, “We believe Carlyle’s strategic enterprise, security portfolio and track record of growing companies, coupled with The Chertoff Group’s deep sector expertise, will enable us to better serve our clients and continue our strong growth. This investment will help expand operations globally, accelerate R&D, and attract the best cybersecurity talent around the world.”
Michael Chertoff, former U.S. Homeland Security Secretary and the co-founder and executive chairman of The Chertoff Group, said, “Cyber threats are an existential risk to companies and individuals around the globe. We and Carlyle are excited to partner with Coalfire, an innovative technology-enabled services company helping clients to address cyber risks.”
Carlyle’s share of the equity for the transaction comes from the Carlyle U.S. Equity Opportunity Fund, a $1.1 billion U.S. middle-market fund. Financial terms of the transaction were not disclosed. Carlyle’s U.S. middle-market team has invested in Philadelphia Energy Solutions, the largest refinery on the eastern seaboard; Service King, one of the largest automotive collision repair centers in the U.S.; ECi Software Solutions, a provider of industry-specific technology; Traxys Group, a financial and logistical provider in the mining industry; AxleTech International Holdings, Inc., a manufacturer of automotive components; and PrimeSport, a global sports travel and events-management company.
Latham & Watkins and PricewaterhouseCoopers are serving as advisors to Carlyle. Kirkland & Ellis is serving as legal advisor to The Chertoff Group. Portico Capital Securities LLC served as the financial advisor and Cooley LLP is serving as legal counsel to Coalfire.
Coalfire is the global technology leader in cybersecurity strategy, cyber risk management and compliance services for private enterprises and government organizations. Coalfire’s professionals are renowned for their technical expertise and unbiased assessments and recommendations. Coalfire’s approach builds on successful, long-term relationships with clients to achieve multiple cyber risk management and compliance objectives, tied to a long-term strategy to prevent security breaches and data theft. Coalfire is currently listed as No. 74 in the “Cybersecurity 500 Hottest Security Companies” and was recently named one of the Top 20 Most Promising Risk Management Solution Providers. For more information, visit www.coalfire.com.
About The Carlyle Group
The Carlyle Group (NASDAQ: CG) is a global alternative asset manager with $193 billion of assets under management across 128 funds and 159 fund of funds vehicles as of June 30, 2015. Carlyle’s purpose is to invest wisely and create value on behalf of its investors, many of whom are public pensions. Carlyle invests across four segments – Corporate Private Equity, Real Assets, Global Market Strategies and Investment Solutions – in Africa, Asia, Australia, Europe, the Middle East, North America and South America. Carlyle has expertise in various industries, including: aerospace, defense & government services, consumer & retail, energy, financial services, healthcare, industrial, real estate, technology & business services, telecommunications & media and transportation. The Carlyle Group employs more than 1,700 people in 35 offices across six continents.
About The Chertoff Group
The Chertoff Group is a premier global advisory firm focused exclusively on security and risk management. The Chertoff Group helps clients grow and secure their enterprise through business strategy, mergers and acquisitions advisory, and risk management security services. In addition, The Chertoff Group makes principal investments to provide growth capital to selected private companies in the security industry. Most recently, The Chertoff Group made a principal investment in Delta Risk, Inc., a global provider of high-impact cybersecurity, risk management and capacity building services to government and private sector clients. Headquartered in Washington D.C., The Chertoff Group maintains offices in Houston, London, Menlo Park, and New York City. For more information, visit www.chertoffgroup.com.
About Portico Capital Securities, LLC
Portico Capital provides independent strategic and financial advisory services in the areas of mergers & acquisitions (M&A), recapitalizations and capital raisings exclusively to private and public companies in the global information and business services/software sector. The firm, founded in 2000, has offices in Greenwich, Connecticut and London, England. For more information, please visit www.porticocapital.com.
S. Searcy Dryden, General Partner