IronPort agrees to AU$1bn Cisco offer

update Cisco has acquired Internet gateway security company IronPort for US$830 million but Australian customers are not likely to be affected -- at least in the short term.

Michael Bosch, managing director of IronPort Systems in ANZ, explained that Cisco has been courting Ironport since April 2005, when the networking giant apparently made a firm offer for the company. However, neither party had been able to agree on terms until now.

Bosch told ZDNet Australia that offers from Cisco were resisted until it agreed to allow Ironport to run as an independent entity.

"This goes back to a firm offer [by Cisco] in April 05, which we turned down.

"Cisco is keeping Ironport as a separate entity. We will continue to report to our CEO -- who will report to a senior Cisco executive," said Bosch.

Bosch admitted that the Ironport and Cisco support teams will eventually be merged together but he did not have a timeframe.

The biggest advantage for Ironport, according to Bosch, is that Ironport's salesforce will now have a massive brand to back them up: "We are now part of a multinational organisation instead of being a startup. Cisco will unquestionably open a lot of doors".

Integrating Ironport
Cisco plans to expand its product range by integrating technologies from IronPort that complement its existing switch and router product lines, especially Cisco network access control (NAC), which uses the systems' infrastructure to enforce security policy for all devices seeking to access the network.

"We feel there is enormous potential for enhanced e-mail and message protection solutions to be integrated into the existing Cisco self-defending network framework [NAC]," said Richard Palmer, senior vice president of Cisco's Security Technology Group, in a statement.

"Using the network as a flexible platform to integrate IronPort's technologies, Cisco will be able to build new security applications as customers' demands evolve," Palmer said.

IronPort, which sells email security appliances that filter email by sender reputation, as well as Web security and security management products, will become a Cisco unit. Upon close of the transaction, the IronPort team and product portfolio will operate as a business unit in Cisco's Security Technology Group, reporting to Richard Palmer.

Analysts see the acquisition as a positive step. Peter Firstbrook, research director at Gartner, said that both companies will benefit.

Cisco will get a sender-based e-mail reputation platform, while IronPort plans to expand its reputation based approach into the IP reputation of Web server traffic.

"Absolutely it's a positive move for both companies," said Firstbrook. "IronPort gets Cisco customers to sell to, which opens up a strong channel for them."

Rachel Brindley of Canalys said that Cisco would also benefit from selling to IronPort customers, as it gives them a presence in the specialist security distribution community.

Brindley said that IronPort would also benefit from being part of a larger organisation because of the ongoing consolidation of the security market.

"There have been so many acquisitions in the security space -- IBM and ISS, EMC and RSA -- that it's difficult for smaller security vendors not to have a wider portfolio. Security vendors with a single solution will find it difficult to generate as a long-term value proposition," said Brindley.