Symantec to buy three security firms

Symantec Corp. said it has entered into deals to acquire three security firms – Recourse Technologies Inc., Riptech Inc. and SecurityFocus Inc. – for a total of US$355 million in cash. Symantec also announced record quarterly revenues of $316 million, up 39 percent from the same quarter last year.

In a conference call with analysts, Symantec CEO John Thompson expressed strong satisfaction with the revenue performance of Symantec’s consumer and enterprise security divisions overall, especially in sales of antivirus products and Symantec’s firewall/VPNs across global markets that include the U.S., Europe, Canada, Japan and Latin America.

The “one disappointment,” said Thompson, has been in Symantec’s network-based intrusion-detection system (IDS) product, NetProwler. Symantec intends to purchase Recourse Technologies primarily to gain its network-based ManHunt product. Recourse also makes the ManTrap “honeypot” product to monitor suspected attackers.

“ManHunt is not just stronger than what we had, but [also] what our competitors had” in network-based IDS, Thompson said. The $135 million Recourse acquisition, subject to regulatory approval, affects Symantec’s stated plans to offer an IDS appliance based on NetProwler. However, Thompson said Symantec will continue to offer its host-based IDS called Intruder Alert.

Recourse’s gigabit-speed ManHunt IDS sensors, which incorporate an anomaly-detection technology not dependent on signature updates, are used by 150 customers, including the U.S. Department of Energy and Ingram-Micro, said Thompson.

Symantec decided to spend $145 million to purchase Riptech, which provides managed security through its security operations center in suburban Virginia, due to its so-called Calterian monitoring technology and its customer base of 500 customers in 40 countries.

Symantec, which operates its own managed security services center in San Antonio with plans to expand centers in England and Germany, will have to find a way to gracefully mesh the technologies and administration of both the Symantec and Riptech operations centers, Thompson said.

SecurityFocus, which Symantec intends to buy for $75 million, provides in-depth security alerts and consulting. SecurityFocus collects information from 14,000 IDS devices around the world.

The main challenge ahead for Symantec, pending the customary government approval of the three acquisitions, will be in successfully integrating the new technologies into Symantec’s product line and services, Thompson acknowledged.

In the analyst teleconference, Thompson did not mention personnel layoffs associated with any of the acquisitions, but he added Symantec would be “wringing out redundancies” brought about by buying the three companies.

The acquisitions of Riptech, Recourse and SecurityFocus all come on the heels of another important purchase just weeks ago by Symantec of a company called Mountain Wave. Symantec bought Mountain Wave for its CyberWolf technology. This technology enables what’s called “security information management” by collecting the output of multiple security devices to provide a comprehensive view of security status across an enterprise.

All together, Symantec is buying its way into the core technologies that will be integrated into future products that Symantec will have more to say about in the future, Thompson said.