--- begin forwarded text Delivered-To: rah@shipwright.com Delivered-To: clips@philodox.com Date: Thu, 29 Jun 2006 22:57:16 -0400 To: Philodox Clips List From: "R.A. Hettinga" Subject: [Clips] EMC to Acquire RSA Security For About $2.3 Billion Reply-To: clips-chat@philodox.com Sender: clips-bounces@philodox.com http://online.wsj.com/article_print/SB115161481971894610.html The Wall Street Journal EMC to Acquire RSA Security For About $2.3 Billion By CHARLES FORELLE June 30, 2006 EMC Corp. won a bidding war for RSA Security Inc., buying the computer-security company for about $2.3 billion. EMC, once primarily a vendor of data-storage hardware to big corporations, has taken steps to broaden its scope because prices are tumbling for big-business tech gear. Security has become a critical area for corporations, worried about hackers, viruses and information theft. EMC of Hopkinton, Mass., said it makes sense to sell both storage equipment and security for the data that go on it. RSA of Bedford, Mass., is the maker of the SecurID tokens used to authenticate users on corporate networks. RSA licensed 4.7 million of the credentials last year, when it had $310 million in revenue. Sales have been fairly stagnant; in 2005 the company's revenue edged up just 1%. Revenue in 2005 was just 10% higher than in 2001. In 4 p.m. composite trading yesterday on the Nasdaq Stock Market, RSA shares jumped $3.52, or 18%, to $22.88 after the New York Times reported that RSA was being pursued by suitors, which the company confirmed yesterday morning. That made RSA costly. EMC agreed to pay $28 a share, a premium of 22% to Thursday's 4 p.m. price and 45% to Wednesday's 4 p.m. price, before news of a potential deal. Investors appeared worried about the price, knocking EMC shares down 45 cents, or 4%, to $10.80 in after-hours trading. EMC shares haven't traded below $11 since 2004. On a conference call with company managers, several analysts pointedly questioned EMC Chief Executive Joe Tucci about the price. Mr. Tucci said the company and the space are "incredibly hot. There were other companies that noticed this." He added that it was "a very competitive situation." He said security and storage "dominate the top" of the list of priorities for corporate-technology managers. He added that EMC's relationships with high-level technology managers could spur sales of the RSA devices. Storage and security outfits have combined before. Last year security and antivirus vendor Symantec Corp. of Cupertino, Calif., bought Veritas Software, a Mountain View, Calif., maker of data-backup technologies. RSA's chief executive, Art Coviello, will become an executive vice president of EMC. -- ----------------- R. A. Hettinga The Internet Bearer Underwriting Corporation http://www.ibuc.com/ 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire' _______________________________________________ Clips mailing list Clips@philodox.com http://www.philodox.com/mailman/listinfo/clips --- end forwarded text -- ----------------- R. A. Hettinga The Internet Bearer Underwriting Corporation http://www.ibuc.com/ 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'