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Sourcefire Acquisition Squelched by Politics, Ignorance

Check Point Software put its proposed $225 million acquisition of IDS/IPS vendor Sourcefire on indefinite hold this Thursday due to political concerns. The acquisition, announced in October 2005, came under the scrutiny of the Committee on Foreign Investment in the...

Check Point Software put its proposed $225 million acquisition of IDS/IPS vendor Sourcefire on indefinite hold this Thursday due to political concerns. The acquisition, announced in October 2005, came under the scrutiny of the Committee on Foreign Investment in the United States (CFIUS) in February 2006. CFIUS, headed by the Treasury Department, investigates the acquisition of U.S. companies and assets by foreign governments. Check Point, which is headquartered in Israel, needed a green light from CFIUS before the acquisition could proceed. THE POLITICS Michele Perry, a Sourcefire spokesperson, cited ???the current climate for international acquisition??? as a key reason for the withdrawal. That???s a reference to CFIUS???s controversial approval of the transfer of operations at several U.S. ports to a company based in the United Arab Emirates. Republicans and Democrats in Congress joined together to kill the deal.

According to an Associated Press story, the Sourcefire deal may have been discouraged in part to pre-empt charges of bias. Such charges would likely arise if the Bush administration approved an Israeli takeover of a U.S. company soon after bowing to Congressional pressure to freeze out the Arabs. THE IGNORANCE The FBI and Defense Department also disapproved of the acquisition. These agencies were spooked because they use Snort, an open source IDS created by Sourcefire founder Marty Roesch, to protect classified computers. They were concerned that a foreign government would acquire sensitive technology. Apparently they don???t understand that ???open source??? means anyone with an Internet connection can acquire this sensitive technology.

Drew is formerly editor of Network Computing and currently director of content and community for Interop. View Full Bio
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