Mergers &acquisitions

The latest to leave Nasdaq for the arms of private investors was online advertising technology provider DoubleClick, which was added to the portfolio of Hellman &Friedman for $1.1 billion.

The move illustrates how technology investors are looking beyond venture capital funding for large returns. Instead, they are targeting established high-tech companies that are arguably undervalued on Wall Street but which can be beefed up for a future sale or a colossal IPO. The forthcoming re-listing of ERP company, SSA, is just one example.

In the case of DoubleClick the purchase seems a safe bet. The company has two sources of revenue: it sells tools to support and track both website advertisements and direct marketing campaigns. That twin focus should allow it to weather fluctuations in marketing spend in either direction.

One company that recently found itself denying it too was considering a private equity buy-out, Sun Microsystems, went on an intellectual property shopping spree over a single week in May. The systems giant picked up the rights to Procom’s network-attached storage (NAS) appliances for $50 million and acquired application access software vendor Tarantella for $25 million.

Procom originally leveraged its strength as a maker of CD servers to build NetForce, a line of NAS filers. But it has struggled against formidable competition from NAS heavyweights EMC and Network Appliance.

Sun’s other buy, Tarantella, with its Citrix-like Secure Global Desktop for providing secure access to server-hosted applications, will sit well within Sun’s thin client division, SunRay.

Meanwhile, IT systems management and services company Compuware augmented its own vision of applications delivery with the acquisition of service delivery measurement appliance builder Adlex for $36 million. Adlex’s ‘passive listening devices’ monitor user sessions and traffic flows so administrators can track how well applications are meeting agreed service levels.

Key IT industry acquisitions in May
Acquirer   Activity   HQ   Target   Activity   HQ   Price  
Afiniti IT consulting &training UK EastView IT service mgmt consultancy UK n/a
BT Telecoms services UK SkyNet Systems LAN services UK n/a
Business &Decision E-business s/w &services Fr Domino Systems IT professional services UK n/a
Captiva Software Input management systems US SWT Document capture s/w France $20.4m
OneTel Telecoms services UK Rednet Internet service provider UK £5.0m
Cisco Systems Networking products US Sipura Technology VoIP s/w for SMEs US $68.0m
Compuware Prog tools, sys mgmt &services US Adlex IT service delivery s/w US $36.0m
Hellman &Freidman Private equity firm US DoubleClick Internet advertising s/w US $1.1bn t25
IBM Systems, s/w &IT services US Healthlink Healthcare consulting US n/a
IBM Systems &IT services US Gluecode Software Open source appln server s/w US n/a
IXEurope Datacentre services UK GIC Business continuity svcs Germany n/a
Juniper Networks IP networking products US Peribit Networks WAN optimisation s/w US $337.0m
Juniper Networks IP networking products US Redline Networks Networked appln perf prods US $132.0m
Mentec International Financial management s/w US Xdat Software Microsoft ERP s/w services UK n/a
Netstore IT outsourcing services UK Cassium Technologies IT services &consultancy UK £5.6m
Nortel Networks Networking products US PEC Solutions Government/security IT services US $448.0m
Novell Networking/Linux s/w US Immunix Linux appln security s/w US n/a
Oracle Database &applns s/w US Hexaware Technologies PeopleSoft India dev centre India n/a
Oracle Database &applns s/w US Covansys JD Edwards India dev centre US n/a
Progress Software Applications dev &DBMS tools US EasyAsk Natural language ecommerce s/w US $9.2m
Quest Software Database management s/w US Imceda Software SQL Server backup s/w US $61.0m
Sapient IT services US Business Information Solutions SAP BI professional svcs US n/a
Sun Microsystems Workstations, servers, web s/w US Tarantella Application access s/w US $25.0m
Sun Microsystems Workstations, servers, web s/w US Procoms NetForce div Networked storage appliances US $50.0m
Sybase Database &applns s/w US ISDD Unstructured data mgmt s/w UK n/a
Sybase Database &applns s/w US Avaki Information integration s/w US n/a
Torex Retail Retail management s/w UK Retail Store Systems Retail management systems US $27.9m
Trend Micro Internet security products US InterMute Anti-spyware products US $15.0m
Verisign Internet security s/w US Lightbridges Prepay INS div Mobile network metering US $17.5m

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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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