Mitsubishi buys Nozomi Networks

Mitsubishi Electric Corp. announced Sept. 9 that it’s agreed to acquire Nozomi Networks Inc., a developer and distributor of operational technology (OT) cybersecurity solutions. Located in San Francisco, Nozomi serves users mostly in power, railways and manufacturing. The reverse-triangular-style merger is expected to close in 2025, subject to regulatory approval.

Mitsubishi reports it’s buying Nozomi to strengthen its OT security business. It’s also part of Mitsubishi’s one-stop, OT security program in response to the increasing importance of OT security measures fueled by the growth of IoT, and increasing digitalization of manufacturing sites and social infrastructures. This effort also relies on Mitsubishi’s existing IT security expertise in financial and other sectors, and aims to promote digital transformation (DX) in multiple industries.

Nozomi has a 33% compound annual growth rate (CAGR) and a revenue base with a gross profit margin exceeding 70%. It will be established as a Mitsubishi subsidiary, and is expected to enhance its security business. By leveraging data and insights obtained via Nozomi’s intrusion-detection and visualization solutions, and by working responsibly with both companies’ diverse installed bases, they plan to co-create new services with customers. For example, their collaboration is expected accelerate the growth of Mitsubishi’s Serendie digital platform and related businesses, while providing services and value that safely and reliably support DX for future customers.