Kicking off the new year with a bang, Milpitas-based FireEye announced it had bought another Internet security company, Mandiant, for nearly $1 billion.
The combination of FireEye's threat-detection technology and Mandiant's ability to react to breaches "allows us to go from alert to fix, almost immediately," FireEye CEO Dave DeWalt said in an interview.
The combined companies have nearly 2,000 employees and boasted more than $100 million in sales last year, DeWalt said.
Mandiant was founded in Alexandria, Va., but in 2012 opened a 10,000-square-foot security operations center in Redwood City. It had raised a reported $70 million in backing from venture capital firm Kleiner Perkins Caufield & Byers and JPMorgan Chase.
Under terms of the deal, Mandiant shareholders will receive 21.5 million shares and options of FireEye stock -- about 13 percent of the company's total shares, DeWalt said.
Those shares closed Thursday at $41.13, down $2.48, but were up more than 20 percent in after-hours trading. FireEye -- which saw its stock price more than double at its September IPO -- also will kick in $106.5 million in cash.
Mandiant CEO Kevin Mandia -- who founded the company in 2004 after cutting his cybersecurity teeth with the U.S. Air Force -- will become FireEye's chief operating officer.
He landed on the cover of Fortune last summer after Mandiant revealed that a unit of the Chinese military had been behind cyberattacks on U.S. companies and government agencies. DeWalt called him "probably the biggest name in all of cybersecurity."
Mandiant board member Ted Schlein, the resident security expert at Kleiner Perkins, jokingly likened the combination of Mandia and DeWalt, who had previously headed anti-virus pioneer McAfee, to "one of those all-star rock bands." But he played down any concerns that the CEOs would not be able to mesh egos.
"These are two guys who really know each other's strengths and weaknesses," he said. DeWalt was previously on Mandiant's board, though he rolled off before last summer's IPO, and the companies have partnered for the past several years.
DeWalt, in fact, said customers had clamored for the two to integrate even more closely -- or perhaps merge.