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Product Watch: Fortinet Issues An IPO

Security appliance, UTM vendor goes public
Network security appliance vendor Fortinet today issued an initial public offering (IPO) of 12.5 million shares of its common stock at $12.50 per share. The Sunnyvale, Calif.-based network security and unified threat management (UTM) vendor announced it will begin trading today on NASDAQ under the ticker symbol FTNT.

One of Fortinet's rivals in the UTM space, Crossbeam Systems, says Fortinet's public offering demonstrates a hot market for security solutions that simplify the cost and management of security solutions. "Fortinet's IPO reflects the growing demand for security solutions that can help companies drive down the cost and complexity of security management," said Jim Freeze, chief marketing officer for Crossbeam, in a statement. "The news also highlights larger data center consolidation and virtualization trends we see that are enabling more cost-efficient, flexible, and scalable IT infrastructures. The security vendors that can deliver these benefits while providing protection against evolving threats will be in the best position to lead the market."

Fortinet said in its IPO announcement that of all the shares in its IPO, 5,781,683 are being offered by the company and 6,718,317 are being offering by selling stockholders. The company is offering underwriters a 30-day option to purchase up to 1.87 million additional shares of common stock. "Fortinet will not receive any proceeds from the sale of shares by the selling stockholders," the company said in its IPO announcement.

Morgan Stanley & Co., JP Morgan Securities Inc., and Deutsche Bank Securities Inc. are serving as joint book-runners for the IPO. Co-managers are Robert W. Baird & Co. Incorporated, RBC Capital Markets Corporation, ThinkEquity LLC, JMP Securities LLC, and Signal Hill Capital Group LLC.

A prospectus is available via Morgan Stanley, J.P. Morgan, or Deutsche Bank. Fortinet is in a "quiet" period so was unable to comment publicly on its IPO.

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