FireEye buys Mandiant for nearly $1B in biggest security deal of 2013

In a massive year-end deal, security company FireEye bought Mandiant for $1 billion Monday after the two companies started getting friendly earlier in 2013, according to the New York Times.

FireEye chief executive Dave DeWalt, formerly the chief of security company McAfee, once sat on the board of both Mandiant, which specializes in responding to attacks, and FireEye. In November 2012, he took over at FireEye, eventually leading it to a majorly successful initial public offering in September in which shares popped 80 percent.

FireEye’s security product turns antivirus technology on its head, watching for both known and unknown malware instead of relying on the signatures of viruses that are already cataloged into AV databases. The company uses virtual machines to monitor a network’s traffic for weird behavioral patterns. If anything pops up, it blocks that traffic from entering the system.

Mandiant more recently made a name for itself when it released a controversial report on a hacking group connected to the Chinese government. At the time, a number of companies in the U.S. had experienced advanced cyberattacks. The company otherwise performs detection and crisis response and tries to attribute the attack when a company is breached.

As the New York Times notes, the two together had been working on projects — Mandiant would come in after FireEye found something fishy — as their technologies are complementary. And it seems they’re not just primed to take on the cyber criminals, but they’re also taking advantage of the recent Edward Snowden NSA leaks.

Both DeWalt and Mandiant founder Kevin Mandia have stated that the companies aren’t going to turn to the U.S. to help monitor and secure their systems. Instead, this is an opportunity for FireEye to bring in a lot of new, cautious customers.

Mandia started Mandiant in 2004. He will now become FireEye’s chief operating officer.

The two held off announcing the acquisition until today after the new year. FireEye’s stock has already risen 22 percent in after-hours trading as investors seem pleased with the deal.