Cisco Systems' big-ticket acquisition of anti-hacking technology maker Sourcefire for about $2.7 billion has set off M&A speculation about several local security companies: Fortinet, Imperva and Palo Alto Networks.
Bloomberg cited a report from William Blair & Co. on Friday that said Sunnyvale-based Fortinet, led by CEO Ken Xie, and Redwood City-based Imperva, led by CEO Shlomo Kramer, are the next likely targets, despite hefty valuations they now carry.
Bloomberg also cited a report from Oppenheimer Holdings Inc. that sees Santa Clara-based Palo Alto Networks, led by CEO Mark McLaughlin, as an attractive acquisition.
In the wake of Cisco paying 12 times Sourcefire's annual revenue, competitors including IBM, Juniper Networks and EMC are seen as likely buyers of Internet security companies.
Shares of both Fortinet and Imperva hit record highs after the Cisco-Sourcefire deal.
None of three companies will be cheap to buy. The market caps of Fortinet and Palo Alto Networks are around around $3.5 billion each and Imperva is valued at about $1.3 billion.