Dyntek makes ‘security sandwich’ with Canadian buyout

An American provider of security solutions made its first foray into the Canadian market Tuesday through the acquisition of a small consulting firm.

Dyntek Inc. of Irvine, Calif., said it would purchase the assets of Alex Woda & Associates, an IT risk management company based in Toronto, for an undisclosed sum. Dyntek primarily provides technology and management solutions to state and local government. The company has about 400 employees and annual sales of $83 million. In contrast, Alex Woda and Associates is comprised of only four people but has an array of large enterprise clients including Manulife Financial, Sun Life Financial and Harris Bank.

Alex Woda said Dyntek has traditionally focused on infrastructure and employs highly talented network engineers. With other recent acquisitions like Entellus, which specilazes in application security, Woda said Dyntek will be able to offer a more comprehensive security program.

“”We bring in the people, the processes side of risk management and attach with the technology,”” he said. “”It almost becomes a security sandwich, if you want to call it that.””

The need for strong security solutions was highlighted on Tuesday after consumer credit reporting company Equifax Canada admitted criminals had gained access to detailed, personal credit files of about 1,400 people. While he could only speculate on what happened, Woda said the Equifax case underscores the increased focus beyond external security issues.

“”It might have been a failure more of the internal security program as opposed to the outside firewalls and networks,”” he said. “”You need to put your controls in layers of defence and be able to isolate departments.””

IDC Canada security analyst Steve Pelking agreed the demand for IT security consulting was at an all-time high.

“”In security services, if you’re an individual with in-demand services, you can start up your own company and sell yourself to the bank and be your own boss,”” he said. “”My sense is right now there probably will be consolidation on the security software side . . . but on the services side, I suppose there may also be consolidation, particularly as maybe some of these companies want to join bigger firms.””

Woda said the pendulum swing towards internal security is driven in part by the need to comply with regulations like the Sarbanes-Oxley Act in the United States, Canada’s privacy law and emerging standards like ISO-17799. No one wants what Woda called a “”Section C”” problem, which refers to a security breach that ends up on section C, page 1 of a daily newspaper like the Globe and Mail. “”That’s a bad place to be,”” he said.

Last October, Dyntek also bought Mormar of New Orleans, an enterprise-wide security consulting firm providing technology solutions to commercial and government clients. Dyntek spokespeople did not respond to calls for an interview at press time.

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