Bedford, MA August 1, 2001 RSA Security has signed an agreement to acquire Securant Technologies, a privately held company that developed the ClearTrust authorization solution. Securant had recently been chosen as the asset management infrastructure provider for auto exchange Covisint. The consideration for the acquisition is $136.5 million in cash, plus acquisition costs. RSA Security will account for this transaction using purchase accounting. It is anticipated that the closing will occur in August 2001, subject to customary closing conditions, including obtaining required governmental approvals.
RSA Security expects this transaction to add approximately $3 to $4 million to revenue of its core operating business in Q3, $5 to $7 million in Q4, and $35 to $40 million in 2002. The company expects that in Q3 this transaction will be dilutive to the earnings of its core operating business in the range of $0.01 to $0.03, breakeven to accretive by up to $0.02 in Q4 of 2001, and accretive by $0.05 to $0.08 cents in 2002, excluding goodwill amortization.
"Omgeo chose Securant's ClearTrust authorization solution to enable role-based control of its Intelligent Trade Management Solutions(SM), including the settlement portal," said George Wrenn, director of portal development of Omgeo, a global joint venture of the Depository Trust & Clearing Corporation (DTCC) and Thomson Financial. "The acquisition should prove to be beneficial for Omgeo and other industry participants as RSA Security will be able to produce additional powerful solutions for the industry."
"Authorization has always been part of RSA Security's mission to enable secure e-business by ensuring the authenticity of people, devices and transactions," said Art Coviello, CEO and president of RSA Security. "This acquisition will help us fulfill that mission. We started with RSA SecurID authentication solutions to help organizations ensure the identity of users. We are adding the ClearTrust authorization solution to enable organizations to control what those users see or do once they have been authenticated. RSA BSAFE encryption software is designed to ensure the privacy and integrity of information and our RSA Keon PKI solutions are designed to ensure the integrity of the transactions users have been authorized to conduct."
"Authorization is an important part of enabling e-commerce, and a natural complement to RSA Security's current capabilities," said Charles Kolodgy, research manager at IDC. "Securant is a technology leader in this segment, and RSA Security's acquisition should enable the company to offer even stronger authorization solutions. This move should add a healthy dose of competition to the market, which can help the segment grow and expand technology innovation.
RSA Security believes this acquisition will enable it to provide leadership in the growing authorization market segment. According to IDC, the Web-based authorization market segment is expected to grow at a compound annual rate of nearly 70 percent over the next four years. This increase is being driven by organizations that need to both expand the number and types of users who can access their networks, applications and Web sites, and at the same time, consolidate their numerous Web sites under a comprehensive portal management system.