[Clips] EMC to Acquire RSA Security For About $2.3 Billion

R.A. Hettinga rah at shipwright.com
Thu Jun 29 20:00:18 PDT 2006


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  Delivered-To: rah at shipwright.com
  Delivered-To: clips at philodox.com
  Date: Thu, 29 Jun 2006 22:57:16 -0400
  To: Philodox Clips List <clips at philodox.com>
  From: "R.A. Hettinga" <rah at shipwright.com>
  Subject: [Clips] EMC to Acquire RSA Security For About $2.3 Billion
  Reply-To: clips-chat at philodox.com
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  <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 <mailto: rah at ibuc.com>
  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'
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-- 
-----------------
R. A. Hettinga <mailto: rah at ibuc.com>
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'





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