NetScout Acquires Network General

NetScout signs definitive agreement to acquire Network General

September 20, 2007

2 Min Read
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WESTFORD, Mass. -- NetScout Systems, Inc. (NASDAQ: NTCT), an industry pacesetter for advanced network and service assurance solutions, today announced that it has entered into a definitive agreement to acquire Network General Corporation, in a combined cash, stock, and debt transaction currently valued at approximately $205 million. The acquisition, subject to customary closing conditions and regulatory approvals, is expected to be completed by early November. Network General employees will become NetScout employees, and the newly combined entity will be headquartered in Westford, Massachusetts.

NetScout believes that for the full year of fiscal 2009 the combined company will approximately double NetScouts current revenue rate, and that the transaction will be accretive for fiscal year 2009 on a non-GAAP basis and accretive on a GAAP basis by the end of fiscal 2009. The combined company will have a larger and more diversified customer base supported by a larger sales force and a planned doubling of R&D spending. Faster revenue growth is expected to be achieved through a broader, integrated product portfolio which will provide customers greater efficiency and value. It is anticipated that there will be significant cost savings realized across the combined company, improving operating margins and earnings per share.

The acquisition furthers NetScout’s vision of providing superior network-based performance management based on a KPI (key performance indicator)/Flow/Packet paradigm. The new, extended portfolio will directly benefit both customer sets by increasing the value of the NetScout solutions available to them while protecting their existing investments. NetScout customers will benefit from the addition of best-of-breed expert packet analysis and data mining, and Network General customers will benefit from best-of-breed real-time monitoring and rapid top-down troubleshooting. For all customers, this will translate into meaningful reductions in their MTTR (mean time to restore) metrics, while reducing the training and skills required to manage complex network-based operations.

“Today, we are bringing together two established companies with complementary technologies to form a new stronger organization that will have the scale, technology, and mindshare to meet some of the greatest challenges associated with virtualization, convergence, SOA and highly distributed network-centric operations,” said Anil Singhal, President and CEO of NetScout Systems. “We are thrilled by the opportunity now before us to elevate and advance the state of the art in packet-flow performance management solutions. This combination positions us to substantially expand our ability to help the largest organizations worldwide to assure that network-enabled applications and services can reliably be delivered to diverse and geographically extensive operations,” continued Mr. Singhal.

NetScout Systems Inc. (Nasdaq: NTCT)Network General Corp.

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