(Associated Press via NewsEdge) Cisco Systems has agreed to pay $830 million in cash and stock to acquire privately held IronPort Systems, a maker of anti-spam and antivirus security products.
The deal is expected to close in the third quarter of fiscal 2007.
Analysts said the acquisition will help Cisco further shed its image as solely a maker of networking infrastructure gear and capitalize on products and services that utilize the network itself.
Cisco, which makes the routers, switches and other devices used to link networks and direct traffic on the Internet, was already dominant in the network security arena.
But executives at the San Jose-based company said they were keenly interested in entering the $2-billion-plus messaging security market, and further profit from the need of businesses to protect their applications from the growing amount of Internet threats.
'Enterprises need to provide increased protection for various kinds of communications _ email and Internet access, as well as protecting data going outbound,' said Richard Palmer, SVP of Cisco's Security Technology Group. 'We see this as a very rapidly expanding market,' growing some 25% a year, he said.
Scott Weiss, founder and CEO of IronPort Systems, said the rich offer and the opportunity to run the company as a separate business unit within Cisco won over the management team during negotiations.
The deal also allows IronPort to compete better with larger rivals, Weiss said.
Cisco said it plans to retain virtually all of IronPort's 408 employees and keep its headquarters in San Bruno.
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