Jul, 2010 : Commtouch to Acquire the Antivirus Division of Authentium
📅 - Company further strengthens and expands its offering to become a complete Internet security platform.
Commtouch, an email software provider, today announced that it has signed a definitive Asset Purchase Agreement to acquire the assets, products, licenses, and operations of the Command antivirus division of Authentium, Inc., a spyware technology aggregator and integrator, and developer of the Authentium ESP Extensible Security Platform.
The company articulates that Command antivirus, which also includes technology to protect against spyware, Trojan downloaders, and other threats, is strongly synergetic with the rest of its product portfolio. With the addition of antivirus technology as a new, third product line, it will be offering a comprehensive set of solutions for inbound and outbound messaging and web security to its customers, which are networking and security vendors and service providers.
It avers that it is expected to pay $4.6 million in cash and an additional "earnout" contingent upon the achievement of certain revenue milestones through December 31, 2011, which may bring the total amount to approximately $8 million. The acquisition is expected to be accretive starting the first quarter post-closing, and should contribute positively to the company's non-GAAP top and bottom line in 2011. The company adds that the acquisition will also allow it to accelerate its rate of growth in revenues and profits.
It explains that the transaction will be financed from its own financial resources. The company ended the second quarter of 2010 with approximately $16 million in cash and zero debt, and management therefore believes that following payment for the deal, it will maintain more than sufficient working capital to fund its existing operations as well as to pursue further opportunities and complete its share buy-back program.
According to the company, Helmuth Freericks, Authentium's Chief Science Officer and Co-founder of Command, will join its management team as General Manager, Antivirus Solutions. The rest of the Command employees, including its virus lab analysts, will also be joining the company, under Freericks' leadership. Combining the skills and resources of both companies, it plans to leverage the Command technology and continue developing and enhancing it. It mentions that closing of the acquisition is subject to customary conditions and governmental approvals, and is to take place by September 30, 2010.
"In the past 18 months, we have expanded our product offerings from a single product line, that of messaging security, to three complementary product lines, including the one we are purchasing now. In addition, we have broadened our target markets from a single market, OEM vendors, to include service providers. We believe that this unique combination of expanded offerings and target markets will set the stage for healthy growth for the coming years," said Gideon Mantel, Commtouch's Chairman of the Board and Chief Executive Officer.
Mantel added, "Commtouch has considered a number of acquisition opportunities during the past year as part of our long-term growth strategy, and after a thorough examination, we decided that Authentium's Command division is the best fit for our business, both strategically and operationally. We believe that many of our current customers will be eager to consolidate their messaging and web security needs around a single reliable vendor, Commtouch, and enjoy the operational simplicity and reduced total cost of ownership that this entails. We are excited about the opportunities ahead."
"We are thrilled to join the Commtouch team. We see great synergies between Commtouch and Command, and both companies have a similar focus on both technological excellence and dedicated customer service," said Freericks. "With the acquisition, we will gain additional resources in terms of capital, marketing, and a renewed focus on enhancing the technology; all of which directly benefit our customers and further enable our commitment to world-class protection. We look forward to continuing to serve our customers moving forward as part of the Commtouch family."
Commtouch, an email software provider, today announced that it has signed a definitive Asset Purchase Agreement to acquire the assets, products, licenses, and operations of the Command antivirus division of Authentium, Inc., a spyware technology aggregator and integrator, and developer of the Authentium ESP Extensible Security Platform.
The company articulates that Command antivirus, which also includes technology to protect against spyware, Trojan downloaders, and other threats, is strongly synergetic with the rest of its product portfolio. With the addition of antivirus technology as a new, third product line, it will be offering a comprehensive set of solutions for inbound and outbound messaging and web security to its customers, which are networking and security vendors and service providers.
It avers that it is expected to pay $4.6 million in cash and an additional "earnout" contingent upon the achievement of certain revenue milestones through December 31, 2011, which may bring the total amount to approximately $8 million. The acquisition is expected to be accretive starting the first quarter post-closing, and should contribute positively to the company's non-GAAP top and bottom line in 2011. The company adds that the acquisition will also allow it to accelerate its rate of growth in revenues and profits.
It explains that the transaction will be financed from its own financial resources. The company ended the second quarter of 2010 with approximately $16 million in cash and zero debt, and management therefore believes that following payment for the deal, it will maintain more than sufficient working capital to fund its existing operations as well as to pursue further opportunities and complete its share buy-back program.
According to the company, Helmuth Freericks, Authentium's Chief Science Officer and Co-founder of Command, will join its management team as General Manager, Antivirus Solutions. The rest of the Command employees, including its virus lab analysts, will also be joining the company, under Freericks' leadership. Combining the skills and resources of both companies, it plans to leverage the Command technology and continue developing and enhancing it. It mentions that closing of the acquisition is subject to customary conditions and governmental approvals, and is to take place by September 30, 2010.
"In the past 18 months, we have expanded our product offerings from a single product line, that of messaging security, to three complementary product lines, including the one we are purchasing now. In addition, we have broadened our target markets from a single market, OEM vendors, to include service providers. We believe that this unique combination of expanded offerings and target markets will set the stage for healthy growth for the coming years," said Gideon Mantel, Commtouch's Chairman of the Board and Chief Executive Officer.
Mantel added, "Commtouch has considered a number of acquisition opportunities during the past year as part of our long-term growth strategy, and after a thorough examination, we decided that Authentium's Command division is the best fit for our business, both strategically and operationally. We believe that many of our current customers will be eager to consolidate their messaging and web security needs around a single reliable vendor, Commtouch, and enjoy the operational simplicity and reduced total cost of ownership that this entails. We are excited about the opportunities ahead."
"We are thrilled to join the Commtouch team. We see great synergies between Commtouch and Command, and both companies have a similar focus on both technological excellence and dedicated customer service," said Freericks. "With the acquisition, we will gain additional resources in terms of capital, marketing, and a renewed focus on enhancing the technology; all of which directly benefit our customers and further enable our commitment to world-class protection. We look forward to continuing to serve our customers moving forward as part of the Commtouch family."
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