“Japanese industrial giant Mitsubishi Electric said it intends to acquire U.S. cybersecurity company Nozomi Networks in a deal valued at about $1 billion.
Nozomi will become a wholly owned subsidiary of Mitsubishi Electric under the terms of the deal, and operate independently. The transaction value includes $883 million in cash as well as previous equity.
Nozomi raised $100 million in a 2024 Series E funding round that included several heavyweights in operational technology, such as Mitsubishi Electric and Schneider Electric. Previous investors included Honeywell; the U.S. Central Intelligence Agency's venture arm, In-Q-Tel; and Johnson Controls.
Nozomi Chief Executive Edgard Capdevielle said the company will continue to provide services to those prior investors and other companies after the acquisition, which is expected to close in the fourth quarter.
"The fact that we're now a wholly owned subsidiary of Mitsubishi does not change the fact that we will continue to be vendor-agnostic," he said.
The size of the transaction, one of the largest of its kind in industrial cybersecurity, reflects the growing interest in the subsector of cybersecurity that deals with operational technology for heavy industries, such as water-treatment plants, power utilities and natural-gas pipelines.
Attacks on critical infrastructure have sharpened the focus on the challenges of securing industrial systems. An August report from cybersecurity vendor Dragos and insurance broker Marsh McLennan estimated the average financial risk of cyberattacks involving operational technology at $31.1 billion globally over the next 12 months.
Geopolitical tensions have prompted concern about the relative frailty of operational technology systems, and the possible effects of successful hacks on these facilities.
The U.S. accused China of burrowing into networks at critical-infrastructure operators for years. Government agencies and state regulators also warned companies to secure their systems after the U.S. bombed Iranian nuclear facilities in June, following intrusions into a handful of U.S. water companies that were blamed on Iran-linked hackers.
Nozomi's relationship with Mitsubishi has deepened. The companies in 2024 launched Arc, a sensor they jointly developed that detects network traffic on the specialized Mitsubishi systems that automate processes in industrial environments.
Most cybersecurity software doesn't natively run on these systems, known as programmable logic controllers, which are often less standardized than operating systems such as Microsoft's Windows.” [1]
Arc is an embedded cybersecurity sensor developed by
Nozomi Networks in partnership with Mitsubishi Electric to detect network traffic and cyber threats on specialized industrial control systems (ICS). The sensor runs directly within Mitsubishi's programmable logic controllers (PLCs), including the MELSEC iQ-R series, to provide deep visibility into operational technology (OT) environments.
Key functions
Deep-level monitoring: Arc is the first sensor to be embedded within industrial control systems, which allows it to monitor "east-west" network traffic (communication between devices on the same internal network) at the PLC level, often referred to as Purdue Levels 0–1.
Threat and anomaly detection: By analyzing network traffic, process variables, and configuration changes at the controller level, Arc can detect anomalies and cyber threats before they escalate across an industrial network.
Real-time security: The sensor enhances data integrity and detects unauthorized access by providing continuous, real-time security monitoring from the network endpoint to the factory floor.
AI-powered protection: Arc uses artificial intelligence to power its continuous monitoring and threat detection, which results in faster incident response and a more robust defense against known and unknown vulnerabilities.
Centralized visibility: For analysis and reporting, the data collected by Arc sensors can be sent to Nozomi's Guardian or Vantage platforms, which provide centralized visibility for OT and IoT networks.
Strategic context
The joint development of Arc is part of a growing cybersecurity partnership between Nozomi and Mitsubishi Electric. In September 2025, Mitsubishi Electric announced it would acquire Nozomi Networks to strengthen its OT security offerings.
The acquisition was driven by the increasing vulnerability of industrial systems as manufacturing and infrastructure undergo digital transformation.
1. Business News: Mitsubishi Electric to Buy Nozomi --- Acquisition is one of the largest yet in the growing industrial cybersecurity sector. Rundle, James. Wall Street Journal, Eastern edition; New York, N.Y.. 10 Sep 2025: B3.
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