IronPort Takeover Secures Cisco a Spot Among Protection Vendors

Includes: CSCO, MFE, SYMC
by: SA Eli Hoffmann

Excerpt from our One Page Barron's Summary (receive it weekly by email by signing up here):

Cisco Makes a Savvy Deal by Mark Veverka

Highlighted companies: Cisco Systems Inc. (NASDAQ:CSCO), Symantec Corp. (NASDAQ:SYMC), McAfee Inc. (MFE)
Summary: Industry experts weren't surprised by Cisco Systems Inc.'s (CSCO) $830 purchase of messaging-security company IronPort Systems last week: Cisco is the world's biggest networking vendor, and its clients prefer buying security-management products from their primary network vendor over third parties. The $2 billion messaging-security market is growing by about 25% a year, and IronPort Cisco 07 01 2007 Chartsupplies about 40% of the top 100 companies, but only 20% of top 500. CSCO's powerful sales force should help it make inroads among the top 2,000 companies globally. Cisco, which studied IronPort for "a few years" before making the deal, has a solid reputation for integrating its acquisitions: Mike Irwin, CEO of security software maker Webroot, says Cisco's acquisitions success comes from its familiarity with the companies it buys, and calls the IronPort purchase "a good way for Cisco to enter the security market using hardware as its entry point." Should this worry security players like Symantec Corp. (SYMC) and McAfee Inc. (MFE)? Barron's: "The jury's out, but it can only help Cisco, whose shares rose 1.14 to 28.47 last week."
Related: Cisco to Buy IronPort Systems for $830 Million, Enthusiastic Response To IronPort Deal, Catalysts That Make Cisco a Buy, Cisco F1Q07 Earnings Call Transcript