SAN JOSE, Calif. -- Secure Computing Corporation (Nasdaq:SCUR), the experts in securing connections between people, applications and networks, today announced that it has signed a definitive agreement to acquire CipherTrust, Inc., the global leader in messaging security. CipherTrust®, a privately-held company, provides innovative layered security solutions to stop inbound messaging threats such as spam, viruses, intrusions and phishing, and protects against outbound policy and compliance violations associated with sensitive data leakage.
Secure Computing is purchasing CipherTrust for total consideration of $273.6 million, which is comprised of $185 million in cash, 10 million shares of Secure Computing common stock, and a $10 million seller note that is subject to certain performance obligations. As a result of the transaction, CipherTrust shareholders will have an approximate 14% ownership position in Secure Computing.
Under the terms of the agreement, Secure Computing has obtained a commitment for a senior secured credit facility from Citigroup. The facility comprises a $115 million term loan and a $20 million revolving credit facility. The transaction is expected to close by September 8, 2006, subject to any necessary regulatory approvals and customary closing conditions.
Depending on the closing day of the transaction, Secure Computing expects CipherTrust to add approximately $15 million to $20 million in revenue in 2006, and approximately $80 million in revenue in 2007. The transaction is expected to be breakeven with respect to pro-forma earnings per share by mid-2007 and accretive to pro-forma earnings per share in the second half of 2007.
In conjunction with this transaction, Jay Chaudhry, CEO, chairman and founder of CipherTrust, will join Secure Computings Board of Directors as Vice Chairman and serve as the companys Chief Strategy Officer and a member of the companys senior management team.
Over the past few months, we have made excellent progress with the integration of CyberGuard, said John McNulty, chairman, president and CEO of Secure Computing. With the brunt of the initial integration activity now behind us, we believe the time is right to continue investing in enterprise gateway security, which is experiencing strong growth. After an extensive review and due diligence process, we believe CipherTrust is the perfect addition to Secure Computing.
Secure Computing Corp. (Nasdaq: SCUR)