Analysis and Commentary, Mergers and Acquisitions
20 June 2008
In a deal announced on Tuesday, but signed last week, UTM (Unified Threat Management) company Fortinet has acquired the software and additional rights from IPLocks, a San Jose, California, database security software vendor.
The deal was not an outright acquisition of IPLocks, but instead an asset purchase with additional licensing and resale rights baked in. According to Searchsecurity.com, IPLocks unwound its US activities that supported the database vulnerability assessment product, but retained the Japenese operation, which centered on database auditing and monitoring tools. As part of the deal, Fortinet acquired the intellectual property for IPArmor, and the rights to continue to develop and resell the Audit Center and Audit control outside of Japan. This bundle of technology will continue to be sold under the IPLocks brand, at least for the time being.
The Japanese division, IPLocks Japan, will continue to operate independently, selling the database vulnerability scanner in Japan.
In an effort to retain organizational knowledge post-acquisition, Fortinet extended offers to the company’s 28 US employees (mostly engineering and sales), many of whom have accepted to join their new corporate parent. Having been in a similar situation twice in my own career, I'll be curious to see how long those employees stick around and waht the long term effect on technology integration efforts is going to be.
This acquisition is a high water mark for the year in terms of the number of deals we have seen. It also provides further evidence of companies being built around missing features and that then get acquired to round out the portfolios of market leaders.
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