Microsoft Confirms Acquisition of Cloud Security Firm Adallom

Confirming earlier rumors, Microsoft on Tuesday announced that it has purchased Israel-based security firm Adallom.

The acquisition reportedly cost Microsoft $250 million, falling short of the previously estimated price tag of $320 million. Terms of the deal have not been revealed.

Microsoft is looking to bolster the security of its cloud-based services with the acquisition. "Adallom expands on Microsoft's existing identity assets, and delivers a cloud access security broker, to give customers visibility and control over application access as well as their critical company data stored across cloud services," the company said in a statement. "Adallom works with popular cloud applications including Salesforce, Box, Dropbox, ServiceNow, Ariba, and of course Office 365."

Founded in 2012 by a group of Israeli security pros, Adallom specializes in what it calls a non-intrusive, flexible, Security as a Service platform that protects collaboration and storage data migrating to the cloud. It provides a window for IT to monitor data sharing and user access, and adheres to industry-specific compliance requirements for keeping sensitive data secure. Adallom's heuristics engine, dubbed SmartEngine, monitors data activity and uses 74 variables to spot, alert and stop threats before they can cause damage.

The firm's customers include FireEye, SAP, Netflix, Hortonworks, Pivotal and HP.

Adallom said that the acquisition has been its end goal for the past couple of years. "Adallom started 2.5 years ago when Ami, Roy and I saw an opportunity to solve a challenge -- helping our customers that were looking for a way to keep their data safe in cloud applications," said Assaf Rappaport, co-founder and CEO at Adallom, in a blog post. "We've come a long way since those early days. Our customers have validated our solution and position in the market as a premier cloud security innovator in the industry."

The acquisition by Microsoft will provide additional funding to Adallom for the continual development of its Security as a Service platform, and adds to the $49 million it has already gained from private investors in the last two years.

About the Author

Chris Paoli (@ChrisPaoli5) is the associate editor for Converge360.