Tenable Holdings Inc

6. Acquisitions, Goodwill and Intangible Assets

In June 2024, we acquired Eureka Security, Inc. ("Eureka"), a provider of data security posture management ("DSPM") for cloud environments. Adding Eureka's DSPM capabilities to our solutions provides customers a view into their organization's cloud data security footprint, fight policy drift and misconfigurations that put data at risk, and enables customers to continuously improve their security posture over time. We acquired 100% of Eureka's equity through a share purchase agreement for total cash consideration of $29.2 million, net of $0.4 million cash acquired.

In October 2023, we acquired Ermetic, an innovative cloud-native application protection platform company and a leading provider of cloud infrastructure entitlement management. The addition of Ermetic enhances Tenable One and Tenable Cloud Security to deliver contextual risk visibility, prioritization and remediation across infrastructure and identities both on-premises and in the cloud. We acquired 100% of Ermetic's equity through a share purchase agreement for total consideration of $243.8 million, including $243.3 million in cash, net of $6.1 million cash acquired, and $0.5 million fair value of replacement equity.

Cash consideration, net of cash acquired, was allocated as follows:

We are still finalizing the allocation of the purchase price for Eureka, which may change as additional information becomes available around income taxes.

Acquired intangible assets and their estimated useful lives at the date of acquisition are as follows:

The results of operations of Eureka and Ermetic are included in our consolidated statements of operations from the applicable acquisition dates and were not material. Pro forma results of operations are not presented as they are not material to the consolidated statements of operations.

We recognized acquisition-related expenses, primarily in general and administrative expense, of $1.9 million, $9.5 million and $2.6 million in 2024, 2023 and 2022, respectively.

Goodwill and Acquired Intangible Assets

The changes in the carrying amount of goodwill are as follows:

The excess purchase consideration over the fair value of acquired assets and liabilities is recorded as goodwill. The acquired goodwill reflects the synergies we expect from marketing and selling these new capabilities from Eureka and Ermetic to our customers. Acquired goodwill is generallynot tax deductible.

Acquired intangible assets subject to amortization are as follows:

Amortization of acquired intangible assets was $19.5 million, $13.9 million and $11.4 million in 2024, 2023 and 2022, respectively. At December 31, 2024, our acquired intangible assets are expected to be amortized over an estimated weighted average period of 5.3 years.

At December 31, 2024, estimated future amortization of intangible assets is as follows: