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Citrix to Buy NetScaler for $300M

Web traffic management specialist NetScaler Inc. is being acquired for $300 million in cash and stock by enterprise access systems vendor Citrix Systems Inc. (Nasdaq: CTXS).

Citrix is adding NetScaler to its November purchase of SSL VPN and VOIP gateway firm Net6 Inc., now the Citrix Gateways division (see Citrix Buys SSL Vendor Net6).

Industry watchers had been expecting acquisition activity in this sector, but Cisco Systems Inc. (Nasdaq: CSCO), rather than Citrix, had been identified as the most likely player to make the next M&A move in the traffic management/WAN optimization sector -- following the recent burst of acquisition activity by its chief rival, Juniper Networks Inc. (Nasdaq: JNPR). (See Juniper Takes Two: Peribit & Redline and Cisco Prowling WAN Optimization?.)

So what is Citrix getting for its money? A much deployed and well-regarded technology -- a device that bundles SSL VPN, compression, and load balancing features in one box -- that's used by more than 500 companies, including some of the world's leading online brands (see NetScaler Passes Customer Milestone, Dow Jones Picks NetScaler, NetScaler Optimizes Google, and Shocking Results in LR's SSL VPN Test). NetScaler estimates that up to 75 percent of Internet users go through one of its systems each day.

That pedigree put NetScaler in Light Reading's Top Ten Private Companies and put it on the shortlist in the Best New Product category of the 2004 Leading Lights awards (see Leading Lights Awards Finalists).

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