Dell may seek to sell Secureworks to private equity: Report

The exploration of a sale of cybersecurity firm Secureworks by majority owner Dell is reportedly underway

Dell Technologies is mulling the possibility of selling Secureworks to private equity investors, according to a report.

According to a Reuters report Thursday, Dell - which is the majority owner of publicly traded Secureworks - has hired a pair of investment bankers as it considers a sale of the security vendor to private equity or other buyers.

In a statement provided to CRN, a Secureworks spokesperson said that "we are aware of the recent media speculation regarding a possible transaction involving Secureworks."

"As a matter of policy, we do not comment on market rumours or speculation," the company said. "We remain focused on serving our stakeholders and advancing our mission to secure human progress with Taegis."

CRN has reached out to Dell for comment.

Dell acquired Secureworks in 2011 before taking the company public in 2016. Since then, the company has at points considered selling Secureworks, including exploring the possibility in 2019, according to Reuters.

Now, Dell is working with Morgan Stanley and Piper Sandler to explore the possible Secureworks sale, the report said. Shares in Secureworks jumped nearly 20 per cent Thursday afternoon to $8.66 (£6.56) a share following the Reuters report.

Last year, Secureworks disclosed two rounds of layoffs, including a 15 per cent staff reduction in August 2023.

Recent years have seen Secureworks transition from its roots as an MSSP to a vendor focused on providing XDR (extended detection and response) capabilities. Secureworks has deeply leveraged its knowledge and experience of managing security for customers in the way that it has built its Taegis XDR platform, Secureworks president and CEO Wendy Thomas told CRN previously.

In May, Secureworks expanded its product portfolio with the debut of its Taegis NDR (network detection and response) offering. Amid the explosion in network traffic, Taegis NDR "doesn't just provide that complete picture of traffic entering and exiting at the edge, but also all internal traffic between endpoints," Thomas told CRN in May.

Over the past several years, numerous publicly traded cybersecurity vendors have been taken private through deals with private equity investors, including KnowBe4, Proofpoint, SailPoint and Ping Identity.

A half-dozen other security vendors – including Darktrace, Tenable and Trend Micro - are among those that could be next to go private, according to recent reports.