The past few years have been a roller-coaster ride for the cybersecurity industry. The cybersecurity industry has been on a roller-coaster ride recently. With attack vectors getting more advanced, breaches have become more frequent. The situation does not seem to be settling anytime soon, with Cybersecurity Ventures predicting that the global toll of cyberattacks will touch USD 10.5 trillion by 2025 with a 15% year-on-year growth in strike rate in the next five years. Firms considering mergers and acquisitions (M&A) should take these figures into account and add an extra layer of cybersecurity due diligence by carrying out a compromise assessment.
What is a compromise assessment?
A compromise assessment is an evidence-based, comprehensive analysis and evaluation of all the existing digital infrastructure of the company from a cyber security perspective. Organizations use these assessments to identify all ongoing and past malicious activities, unauthorized access, network weaknesses, data breaches, and indicators of compromise. Compromise assessments enable a business to establish a long-term cybersecurity plan.
See also Compromise Assessment: Find the adversary inside to learn about the core objectives and the various stages of a compromise assessment
Why conduct a security compromise assessment as part of cybersecurity due diligence before an acquisition?
A compromise assessment delivers an overall audit and review of an organization's networks, and stock of on-premise and cloud-based data, architecture, applications used, past logs, existing digital infrastructure, compliance policies, end-points, user behaviour, etc. Any weakness in infrastructure or indicators of compromise (IOCs) of malicious activities is easily detected.
Here are 4 important points to consider while performing a compromise assessment before a merger.
Confirm the value
The organization's overall value proposition depends on the digital infrastructure, network, and data. A compromise assessment gives the acquiring firm a clear picture of the all-around security and pinpoints any weaknesses of the company's existing infrastructure. If the acquired firm's security position is fragile, the buyer will have to pay a higher price to secure it after acquisition. This may have an impact on the company's value as a whole. Getting a clear picture of a company's cybersecurity is one way of assessing the company's value and completing due diligence.
Check for breaches
Having a robust security system in place is not a guarantee against cyberattacks and breaches. It is always advisable to get a compromise assessment done to audit and re-verify the security of the network and other internal systems before acquisition. Acquiring a business with a fragile security stance can threaten the overall infrastructure of the newly-unified firm.
Security of Intellectual property (IP) and user data
Every company holds user data, intellectual property, and its patents as sacred. With growing concerns over cyber thefts targeting intellectual property and user data, a compromise assessment should be completed before every merger to detect whether a company's intellectual property and other sensitive user data have been compromised. According to a report by ZDNet article, the FBI in the US is currently investigating over a thousand cases of intellectual property theft.
Ensure you want to make the acquisition
As per Forescout's report, cybersecurity and compromise assessment play a critical role in due diligence before acquisition and merger. According to this report, 53 percent of respondents said that paramount security issues and incidents might delay or cancel an M&A deal. An undisclosed data breach or related problems may prod the acquirer to discontinue the negotiations or even drop the merger plans. Companies like PacketLabs can help with conducting a compromise assessment for an analysis of the risks before acquisition. Call PacketLabs to tap into its rich reservoir of skillful security industry experts to help make the acquisition process more seamless.
Organizations are increasingly favouring mergers and acquisitions to consolidate their market positions. Leveraging a compromise assessment before an acquisition is essential to measure the comprehensive weakness parameters of the organization's infrastructure. Contact PacketLabs today to get the most out of a comprehensive compromise assessment.