Fluke To Buy Visual Networks

Fluke Networks—a division of the Danaher Corp.—announced Friday it penned an agreement with Visual Networks to buy the Rockville, Md., company for $75 million.

The deal could close by the end of March, according to Paul Stone, director of worldwide marketing at Fluke, Everett, Wash.

It's still too early to say how the two vendors will reconcile their separate reseller channels, Stone said. He described Fluke&'s sales strategy as a hybrid between direct and indirect channels, but did know what percentage of sales went through channel partners.

Less than two weeks ago, Visual Networks began a new channel program to increase its indirect sales. The company was looking to add as many as 50 new VAR partners to its current roster of about 100, according to Owen Brennan, vice president of channel sales at Visual Networks.

The deal, which still faces regulatory approval, will give Fluke ownership of Visual Networks' recently revamped Visual UpTime Select line of LAN and VoIP performance monitoring products. In August, Visual Networks released a new VoIP assessment product called VoIP Advisor. The VoIP technology was especially attractive to Fluke, Stone said.

"The VoIP [product set] was really synergistic with what we have going on," he said, adding that Visual Networks' application performance monitoring was also a lure in the deal.

It is too early to say when integration of the two vendors product lines will be complete, Stone said. He declined to speculate on the possibility of pending workforce reductions or other restructurings ahead of the deal closing.

Al Higgins, president of Interlink Communication Systems, a Visual Networks master reseller in Clearwater, Fla., said solution providers who sell either of the vendors' products should resist looking too far forward in regards to the merger. "Let's not lose focus of what's going on right now," he said. "Make sure the revenue opportunities are all being captured and keep pounding the rock."

Fluke Networks nabbed a relatively weakened Visual Networks for $1.83 per share. As of Nov. 28, the vendor's stock price hovered just under $1.50 per share, significantly lower that its 52 week high of $4.75 per share, according to Visual Networks.

Consolidation among the Baby Bells shrank Visual Networks' lucrative telco market, according to David Peikin, director of marketing and corporate communications at Visual Networks. "It hit us pretty hard," he said.

The new channel program from Visual Networks was a clear attempt to get the company back on track after losing revenue due to the consolidated telco landscape, Higgins said. "I see a lot of positives to this," he said.