Secure Computing adds CipherTrust to acquisition list

Vendor believes latest purchase will bring an additional $80m revenue in 2007

Consolidation in the security market has continued with acquisition hungry vendor Secure Computing snapping up messaging security firm CipherTrust for $273.6m.

The $273.6m comprises $185m in cash, 10 million shares of Secure Computing common stock, and a $10m seller note that is subject to certain performance obligations. As a result of the transaction, CipherTrust shareholders will have an approximate 14 per cent ownership position in Secure Computing.

Secure Computing, which snapped up CyberGuard for $295m last August, revealed its expects CipherTrust to add approximately $15m-$20m in revenue in 2006, and approximately $80m in 2007.

CipherTrust’s chief executive Jay Chaudhry will join Secure Computing’s board of directors as vice chairman and serve as the company’s chief strategy officer and a member of the company’s senior management team.

John McNulty, chief executive of Secure Computing said: “Over the past few months, we have made excellent progress with the integration of CyberGuard. With the brunt of the initial integration activity now behind us, we believe the time is right to continue investing in enterprise gateway security, which is experiencing strong growth. After an extensive review and due diligence process, we believe CipherTrust is the perfect addition to Secure Computing.”

"We are excited to be joining forces with Secure Computing," said Jay Chaudhry, CipherTrust chief executive. "This transaction brings together two very successful companies that together can redefine enterprise gateway security."

"The synergies between the two companies are tremendous," added Chaudhry. " Our products and technologies are complementary, our channel and selling strategy similar but with little overlap in channel partners, and our teams have strong domain expertise in security with an established record for delivering innovative products. Our combined business will bring focus and innovation of a start-up and the scale, size and financial strength of a larger company."

"Secure Computing's merger with CipherTrust addresses the convergence of threat and messaging management gateways," said Chris Christiansen, program vice president of security products and services at IDC. "CipherTrust's messaging security complements Secure Computing's focus on Unified Threat Management, Web filtering and hardware authentication. With messaging increasingly viewed as a critical enterprise application, the ability to secure traffic at wire speeds is a critical business enabler. Moreover, CipherTrust's TrustedSource reputation technology, with its network of thousands of sensors throughout the Internet, will add a new element of sophistication and intelligence to existing UTM and SCM products."