Secure Computing completes merger with CyberGuard

The merger creates a new leading IT security provider, which has a combined customer base of over 17,000 customers and 1,300 resellers worldwide, with distribution channels extending across more than 100 countries.

"We believe that CyberGuard is a perfect fit for Secure Computing, as it accelerates the company's strategic vision and better positions us in the two fastest growing segments of the security industry," said Andy Philpott, EMENA Vice President, Secure Computing.

"By combining the two companies, Secure Computing is the new market leader in the Unified Threat Management (UTM) market, the fastest growing segment of the IT security market according to IDC. This merger also accelerates our position in the Secure Content Management (SCM) market, and clearly positions Secure Computing as the number two player in web filtering with approximately 21 million licensed seats."

"Going forward, we will leverage our complementary technologies and channel partnerships, and gain additional important competitive advantages in the market," added Philpott.

Secure Computing stockholders approved the issuance of shares of Secure Computing common stock to the holders of shares of CyberGuard common stock in connection with the merger, at Secure Computing's special meeting of stockholders. CyberGuard stockholders also voted to approve the merger agreement between the two companies.

In connection with the merger, Richard L. Scott, a member of CyberGuard's board of directors, and Cary J. Davis, a Warburg Pincus Managing Director, are being added to Secure Computing's Board of Directors.

At its special meeting, Secure Computing stockholders also approved two additional proposals: (i) the issuance of shares of Secure Computing Series A preferred stock and a warrant to purchase shares of Secure Computing common stock to Warbug Pincus Private Equity IX, L.P. and (ii) amendments to the Secure Computing amended and restated 2002 Stock Option Plan to increase the number of plan shares by 1,500,000, among other changes.

In connection with this transaction, Warburg Pincus, the global private equity firm and a leading investor in technology companies, will invest $70 million in Secure Computing in the form of convertible preferred stock with warrants.

CyberGuard offers a broad line of scalable high performance firewall/VPN appliances, sophisticated security processors and accelerator products for the SSL and IPsec markets, and industry leading embedded Linux and Linux security solutions.

Based on the company's Total Stream Protection framework and managed via its Global Command Centre, CyberGuard's products go beyond network-level security to provide protection against the most dangerous application-layer vulnerabilities and avoid potential damage, securing the entire data stream.

Sami Mulla, Director, Middle East & North Africa, Secure Computing, said,

"This merger will help Secure Computing leverage the expertise and experience of CyberGuard to become a leader in the security industry. The transition for CyberGuard has been smooth following this merger, as we share common goals and our business principles are in perfect synergy with each other."