Australian owned and operated security appliance vendor SnapGear has been acquired by US vendor CyberGuard for an initial price of $US16 million.
The acquisition is a boon for the Brisbane-based management and staff of SnapGear, who have seen their fair share of merger and acquisition activity already. In May 2000 the company was acquired by Lineo, but by September 2001 the management and staff of SnapGear bought more than 80 per cent of Lineo’s stock to spin off from the vendor and once again become a standalone company.
CyberGuard is a manufacturer of high-end VPN and firewall appliances, distributed in Australia by Blue Sky Industries and eGlobal. CyberGuard will pay the privately held company an initial $US16 million, but will also offer an initial bonus of about $US3 million if SnapGear meets performance targets over the next 12 months. SnapGear vice-president of marketing Miles Gillham, told ARN, the company was confident about meeting these numbers.
"SnapGear is an ideal acquisition for CyberGuard," president of CyberGuard, Pat Clawson, said. "First, it rounds out our product offering and allows us to meet the demand of enterprise customers who want efficient, dependable security at the edge of their networks.
"Second, it brings new technology products and expertise into our portfolio since SnapGear incorporates embedded Linux security into their appliances. Third, because SnapGear targets a different market than CyberGuard, their worldwide distribution channel will complement, not replicate, ours. We believe this can generate revenue growth for both entities."
Gillham said that the products developed by the two companies or complimentary, and that the management software for both devices are both SNMP-based (Simple Network Management Protocol) – which should lead to full product integration by mid-2004.
The acquisition essentially doubles the global distribution channels for both companies, Gillham said.
SnapGear’s OEM relationships, and its relationships with local distributors Dovetail, MPA Systems, TechPlus, ServerBits and Connec-Tech Distribution, would all remain unchanged in the short term.
Manager of channel sales in Asia Pacific for SnapGear, Derek Morwood, said he should have a better understanding of the consolidated entity’s channel direction within a few weeks.
It is not the first time SnapGear had been approached by interested parties in recent history, Gillham said.
“We have turned away many venture capitalists with suitcases of cash,” he said. “But we weren’t going to turn away the right deal.”