Last year Orange County’s diverse tech sector produced big headlines, some of which we highlighted in our recent year-in-review issue. But plenty of other storylines warrant a second look as we enter the new year.
• Irvine-based scanning software maker Kofax was sold by Lexmark International to Chicago private equity firm Thoma Bravo. The buy of Lexmark’s enterprise software business, which consisted of Kofax, ReadSoft and Perceptive, was thought to draw a sales price of about $1.2 billion. It cemented a rare feat for Chief Executive Reynolds Bish, who went three for three in positioning the business software maker for a sale in as many years.
• Irvine-based CrowdStrike Inc. raised $100 million in a Series D round in May, the second time the security software maker hit the benchmark. The Business Journal reported in November that the company changed its headquarters from Irvine to Sunnyvale in the heart of Silicon Valley, a sting to an emerging cybersecurity hub developed here over the past few years. CrowdStrike has raised nearly $275 million since it was established in 2011 by former executives of McAfee Inc. and Networks in Motion Inc.
• SecureAuth Corp., another sizable player in OC’s cybersecurity hub, agreed to a $200 million sale in September to El Segundo-based private equity firm K1 Investment Management. Under the deal, K1 will roll portfolio company Core Security Inc. under the banner of SecureAuth, with Chief Executive Jeff Kukowski leading the combined company from its Irvine base, a balm to Cyber here.
The sale marked another successful investment by Newport Beach-based Toba Capital, SecureAuth’s primary backer and OC’s largest venture capital firm, launched by Vinny Smith in late 2012. Smith was brought into the deal by SecureAuth Chief Financial Officer Tom Stewart and his brother, Acacia Research Corp. Chief Executive Rob Stewart, who backed the company in an early $4.6 million financing round.
• TTM Technologies Inc. agreed last month to acquire East Syracuse-based Anaren Inc. for $775 million from affiliates of New York private equity firm Veritas Capital.
Under the deal, the Costa Mesa-based company acquires key radio frequency components and subsystems for the aerospace and defense, and networking/communication markets, positioning it to benefit from projected increased spending in advanced radar technology and the ongoing ramp-up of 5G connectivity.
The combined companies will have annual sales eclipsing $2.8 billion.
The third-largest transaction in TTM’s nearly 20-year history, scheduled to close in the first half of this year, would catapult it ahead of Tokyo-based Nippon Mektron Ltd. for the title of the world’s largest printed circuit board maker.
• Irvine-based chipmaker Conexant Systems LLC, part of a storied legacy in OC tech, was sold for $342 million to Synaptics Inc. in San Jose.
Conexant, which spun off in 1999 from Rockwell International, employs about 300 and generates about $100 million in annual revenue. It emerged from bankruptcy protection in 2013, when hedge fund billionaire George Soros’ QP SFM Capital Holdings Ltd. took ownership.
The merger of its wireless communications business in 2002 with Alpha Industries Inc. in Woburn, Mass., created Skyworks Solutions Inc., OC’s third-largest chipmaker by employment.
• Newport Beach-based MSC Software Corp. was sold for $834 million to Swedish IT service provider Hexagon AB.
MSC operates as an independent business unit in Hexagon’s Manufacturing Intelligence division. The company was OC’s 15th-largest software maker last year, with an estimated 150 local workers. It posts annual sales of about $230 million.
Hexagon takes over one of the oldest companies in the tech industry in MSC, which achieved prominence in 1965 with breakthrough simulation software that helped the Apollo 11 spacecraft land on the moon four years later. It was taken private in late 2009 in a $390 million cash deal by Palo Alto-based private equity firm Symphony Technology Group LLC.
• Newport Beach-based manufacturer ADOMANI Inc. debuted on the NASDAQ Capital Market in June after becoming the first equity-crowdfunded company to list on the tech-heavy exchange. The company, traded under the ticker symbol ADOM, raised about $9.2 million in net proceeds after selling more than 2.5 million shares at $5 per share, earning a distinction that no other company can claim.
ADOMANI, which developed a drive train that converts an internal combustion engine into an electric motor assembly, moved its headquarters in September to Corona in Riverside County.
• First-person shooter game “Overwatch,” released in 2016 by Irvine-based Blizzard Entertainment Inc., took less than 12 months to become a $1 billion business, shattering company records along the way.
The title, released on PlayStation, Windows and Xbox One—Blizzard’s first launch on the Microsoft Corp. console—now claims more than 35 million players. It’s also the foundation of the Overwatch League, which debuted in December at Blizzard’s new esports arena at Burbank Studios, and features 12 franchises in Boston, London, Los Angeles, Miami-Orlando, New York, San Francisco, Seoul and Shanghai.
Team owners, which reportedly ponied up as much as $20 million per franchise, include Los Angeles Rams owner Stan Kroenke and his son Josh; New England Patriots owner Robert Kraft, Sacramento Kings minority owner Andy Miller, and Comcast Spectacor, the Philadelphia Flyers owner and sports arm of cable giant Comcast.
