Baltimore close to Content Technologies sale

23 January 2003 Struggling security software vendor Baltimore Technologies is close to agreeing a sale of its Content Technologies subsidiary, just a week after its favoured buyer pulled out.

A deal is expected to be reached before the end of the week with a syndicate led by Hermann Hauser’s Amadeus Capital Partners. The price is expected to be between £20 million (€32.3m) and £50 million (€80.7m) in cash.

That compares with the price of about £700 million (€1.1bn) that Baltimore paid for Content Technologies in September 2000 in an ill-fated, all-stock deal.

If successful, Amadeus is expected to merge Content Technologies with Clearswift, an email management software company in which it led a $10 million round of venture funding in June 2001. Other Clearswift investors include Milan, Italy-based Pino Venture Partners and New York-based 4C Ventures.

The heavily discounted price reflects the fact that Baltimore is in desperate need of cash. In the quarter to the end of September 2001, the company had £32.4 million (€52.3m) in cash on its balance sheet, but is burning through it at between £9 million (€14.5m) and £12 million (€19.4m) per quarter.

As a result, Baltimore is estimated by analysts to have less than six months to break even or find further sources of funding. Baltimore put the “for sale” sign over Content Technologies in August 2001, when the scale of its cash crisis became clear.

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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