VeriSign To Acquire Guardent

VeriSign intends to pay $140 million in cash and stock for Guardent. The acquisition is expected to close first quarter of 2004 pending regulatory approvals and other conditions.

VeriSign entered the MSSP space in 2001 and has steadily gained Fortune 200 customers seeking a provider to manage firewalls, intrusion-detection systems and other security solutions.

VeriSign intends to keep both companies' channel strategies in place, he said. Guardent generates about 50 percent of its revenue from the channel, while VeriSign generates about 25 percent of its revenue from the channel.

"We've invested a lot in training the channel and it has paid off for us," said Dan McCall, executive vice president and co-founder of Guardent, Waltham, Mass. "Our products represent a great opportunity for the channel."

VeriSign often competed against Guardent for RFPs, and when one of the companies lost, it was usually the other that landed the contract. This in part led VeriSign to begin acquisition negotiations with Guardent, said Mark Griffiths, vice president of security services, VeriSign, Mountain View, Calif.

"An indicator that managed security is moving into the mainstream is the types of RFPs companies like ourselves can now respond to," Griffiths said.

Over time, VeriSign intends to integrate Guardent's TeraGuard security information management infrastructure, appliances and professional services with its own technology and management expertise, he said. VeriSign also gains 150 employees and Guardent's Security Operations Center in Providence, R.I.

"It wasn't just there technology, which in the case of the appliance is more advanced than what we have, but they held the same philosophy that we have here of selling services and not just selling products," Griffiths said.

Many of Guardent's resellers opt to private-label Guardent's services and layer their own solutions on top of itsplatform, McCall said. VeriSign is currently briefing partners about the acquisition and, over time, wants partners to sell a combined VeriSign/Guardent solution, Griffiths said.