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FireEye Stock Jumps After Blackstone Deal

Shares of cybersecurity firm FireEye jumped in after-hours trade after Blackstone and ClearSky jointly took a $400 million stake.

Cybersecurity company FireEye, Inc.  (FEYE) said Blackstone Tactical Opportunities  (BX)  and ClearSky have taken a $400 million stake in the company, part of which is being used to fund the acquisition of Respond Software.

The announcement came after the bell Thursday.

Shares of the Milpitas, Calif., company surged 17.91% to $16.79 in after-hours trading at last check. 

Shares of Blackstone were up 1.44% to $58.64 at the end of trading. They were little changed after markets closed.

Blackstone and ClearSky bought $400 million in newly designated 4.5% Series A convertible preferred shares.  The Series A Preferred will be convertible into shares of FireEye's common stock at a conversion price of $18 a share, the company said in a statement.

“Their investment validates our vision and provides financial, operational and leadership resources to accelerate our strategy," said Kevin Mandia, chief executive officer, FireEye, in the statement.

FireEye will appoint Viral Patel, Senior Managing Director at Blackstone, to its Board of Directors upon the closing of the transaction.

Meanwhile, FireEye's acquisition of Respond Software is valued at $186 million, the company said in a separate statement. The deal was in cash and stock.

FireEye said Respond Software opens new market opportunities to deliver its cyber investigation capabilities to a broad set of customers. Respond's XDR engine will integrate with FireEye's Mandiant Advantage Platform to speed up response times and deliver better security outcomes.

"With Mandiant’s position on the front lines, we know what to look for in an attack, and Respond’s cloud-based machine learning productizes our expertise to deliver faster outcomes and protect more customers,” said Mandia in the statement.

"This creates a learning system with new capabilities that will enable us to expand our Mandiant portfolio and drive new XDR revenue through our Mandiant Advantage platform.