News about a competitor....they also have ECC products:
Kasten Chase Acquires Karthika Technologies
Symbol: KCA
2002/04/15 News provided by BCE e-News Services.
Company: Kasten Chase Applied Research Limited
Symbol: KCA/T
Toronto, Ontario
Positions company for first-mover advantage in emerging market
for secure networked storage
Kasten Chase (TSE:KCA), a leading provider of high-assurance data
security solutions, today announced that it has acquired all of
the outstanding shares of Karthika Technologies, Inc., a
Toronto-based IT security company. Karthika comprises some of the
world's leading cryptographic researchers and experts in applied
cryptography and has focused much of its expertise on the
development of market-leading security solutions for networked
data storage, one of the fastest growing sectors in information
technology today.
With this acquisition, Kasten Chase will gain significant market
leadership advantages and new, enabling technologies, including:
* First-mover advantage in the emerging market for secure
networked storage, with security solutions for Storage Area
Networks (SANs) and secure, Internet Protocol-based
Network-Attached Storage (NAS) appliances. These solutions
utilize high-speed cryptographic technology and are optimized for
the transfer and storage of mass volumes of data.
* Advanced Elliptic Curve Cryptography (ECC) available as a tool
kit for enabling secure applications in the high-growth markets
for mobile computing, m-commerce, the wireless Internet, and
networked storage.
* The addition of some of the world's premier thought leaders in
cryptographic research and applied cryptography, which will
enhance the company's ability to deliver next generation security
solutions where robustness, speed of operation, and efficiency
are paramount.
"The Karthika acquisition provides us the opportunity to
accelerate the achievement of our shared commercial market
objectives. It has secured for Kasten Chase a first-mover
advantage in the emerging market for secure networked storage,"
said Paul Hyde, Vice Chairman and Chief Executive Officer at
Kasten Chase. "This transaction fits perfectly with our stated
strategy of growth through acquisitions that provide unique and
differentiated new business opportunities. In Karthika, we are
acquiring exciting new technology, leveragable intellectual
property and a world-class research and development team to
complement our already strong team of professionals."
"Our goal is to be the first company to market with a
comprehensive security solution for networked storage," said Hari
Venkatacharya, President of Karthika Technologies. "We firmly
believe that this transaction will expedite our market entry and
accelerate revenue growth significantly. Ours are two highly
complementary organizations; Karthika, an emerging company with
leading technology and innovative applications in growing market
sectors, and Kasten Chase, an established, financially-strong
market leader, with proven technology and an outstanding track
record in bringing new high-assurance security solutions to
market."
"With this bold step, we are positioning ourselves at the
forefront of new growth opportunities for enterprise applications
of high-assurance data security," stated Paul Hyde. "Our ability
to innovate and capture leadership in our chosen markets will
continue to differentiate us from potential competitors. It is
our intent to leverage our product development and market
expertise, and our experience as a trusted partner of the U.S.
National Security Agency (NSA) to achieve success in this new
chosen market."
With its existing security solutions, Kasten Chase already enjoys
significant market place and technological advantages, including:
* A leadership position in the U.S. government market with its
RASP Data Security(TM) portfolio. Certified by the NSA, this
portfolio protects some of the most sensitive information in the
world.
* An innovative secure e-document delivery solution enabling
organizations to leverage the immediacy, ubiquity and familiarity
of the Internet's most popular application - e-mail - to
communicate with large, diverse communities of stakeholders in a
highly secure manner.
* Assurency(TM), a comprehensive suite of secure mobile computing
solutions that safeguards valuable data stored on, or transmitted
between, PDAs, wireless e-mail pagers and other mobile computers.
"With the obvious synergies and significant advances we will
enjoy through the addition of Karthika personnel and technology,
we have now set the stage to move purposefully toward the next
phase of our corporate development," added Paul Hyde. "Kasten
Chase is now strengthened in its ability to pursue unique growth
opportunities and extend its solutions deeper into the
enterprise.
"From a shareholder perspective, we strongly believe that we have
brought substantial value to Kasten Chase through this
acquisition. Increasing shareholder value has been a primary
consideration in our search for acquisitions and a key objective
of our longer term growth strategy."
About Karthika Technologies
Karthika Technologies develops end-to-end security solutions for
data in transit and at rest. In addition to securing networked
storage, the company's cryptographic technology is well suited
for resource-constrained devices, such as mobile computers or
smart cards, where performance and efficiency are primary
considerations.
Under the direction of Chief Scientist Dr. V. Kumar Murty,
Karthika's Advanced Technology Group (ATG) is at the forefront of
research and development in new, efficient cryptographic systems.
This Group is actively developing refinements to Elliptic Curve
Cryptography (ECC) as well as pioneering cryptosystems based on
Abelian Varieties Cryptography (AVC) and other advanced
mathematical models. Abelian Varieties are the higher dimensional
analogues of elliptic curves and are a natural candidate for next
generation public key cryptography.
"We are tremendously pleased that some of the world's thought
leaders in cryptographic research and its application are joining
our organization," said Paul Hyde. "This acquisition enhances our
ability to deliver next generation security solutions, where
robustness, performance, and efficiency are paramount."
Karthika recently launched its first commercial product, a
high-efficiency cryptographic tool kit based on ECC.
"KryptoKit(TM)" is targeted at system architects developing
secure applications for mobile computing and commerce, the
wireless Internet, and networked storage.
About the Acquisition
Under the terms of the acquisition agreement, Kasten Chase will
issue, in total, 3.4 million shares to the shareholders of
Karthika and pay some associated transaction expenses totaling
$455,000. 2.2 million shares were issued on closing and the
remaining 1.2 million shares will be issued in installments over
the period from September 30, 2002 to September 30, 2003.
Karthika Technologies now becomes an operating division of Kasten
Chase, where several key employees of Karthika will assume senior
roles. Hari Venkatacharya maintains his position as President of
Karthika Technologies, a Division of Kasten Chase, and will have
overall responsibility for the company's initiatives in the area
of secure networked storage. Mr. Venkatacharya, who will report
directly to Jim Davies, Kasten Chase's President and Chief
Operating Officer, will also hold the title of Senior Vice
President at Kasten Chase.
Dr. V. Kumar Murty, a co-founder of Karthika, will assume the
role of Chief Scientist at Kasten Chase, leading the Advanced
Technology Group. Dr. Murty will continue to work within the
Karthika Division, where his principal focus will be the
implementation and evolution of the Kasten Chase secure networked
storage solution, as well as ongoing direction of the company's
research activities in advanced cryptographic systems and
architectures.
In addition to his new position at Kasten Chase, Dr. Murty is
Professor and an Associate Chair in the Department of Mathematics
at the University of Toronto. Dr. Murty holds a Ph.D. from
Harvard University and was a Member of the Institute for Advanced
Study, Princeton. He is a Fellow of the Royal Society of Canada,
and a Steacie Fellow. Dr. Murty's research interests include
number theory and the application of advanced mathematical models
to cryptography. He has authored a number of books and numerous
publications dealing with these subjects.
"While there are a number of opportunities to blend Karthika
technologies within our current development programs for
Assurency Secure Mobile Computing and Secure e-Document Delivery,
it is of more significance that both companies share a common
vision," said Dr. Murty. "By mitigating risk in the sharing and
storage of sensitive information in a manner that is intrinsic to
the system and highly transparent to the user, we believe that we
will effectively enable a wide variety of new applications for
businesses and governments. We will work as one to eliminate the
vulnerabilities that threaten an organization's critical IT
infrastructure as well as the privacy of those individuals who
use it, and in doing so we will bring new levels of empowerment
to both."
With more than 30 years of study and research in advanced
mathematics and cryptography at the University of Waterloo,
University of Toronto, IBM and Hewlett Packard, Dr. Ian F. Blake
will assume the role of Director of Research at Kasten Chase. Dr.
Blake, a recognized leader in Elliptic Curve Cryptography, error
correction and communications, will support research activities
within the ATG, as well as consult with project teams during
system design and development.
Dr. Blake received his M.A. and Ph.D. from Princeton University
and is currently Professor of Electrical and Computer Engineering
at the University of Toronto. He has written several books
dealing with advanced mathematics and related coding theory,
communications and information security.
With more than 20 years of software application development and
project management experience, Clement Kent joins Kasten Chase as
Vice President, Technology Development, Secure Networked Storage.
Mr. Kent will continue to oversee the development activities
within the Karthika Division.
In total, 23 employees of Karthika will join Kasten Chase
effective immediately.
The Emerging Market for Secure Networked Storage
A number of factors - including new e-business models,
data-intensive applications such as enterprise resource planning
and supply chain management, and rich media applications - are
spurring significant growth in storage requirements. Storage
capacity is doubling every 12 months, according to the Storage
Networking Industry Association. A recent report from the
University of California at Berkeley indicates that the worldwide
requirement for data storage is expected to grow exponentially,
from 3 billion gigabytes in 2000 to 24 billion gigabytes in 2003.
Market analyst Gartner Group claims that storage represents the
largest component of the enterprise computing budget, and
predicts that the storage media and infrastructure market will
reach $US 52.0 billion in 2005, up from $13.8 billion in 2000.
Networked storage is emerging as the dominant topology,
surpassing direct-attached storage in 2002. Networked storage
provides more efficient use of storage resources, greater ease of
management and increased scalability. It also exposes enterprises
to new vulnerabilities and threats, many of which come from
within the enterprise. In addition, there are today a number of
credible attacks on storage networks that cannot be protected by
the same methodologies used to safeguard traditional IP networks.
An unprotected storage network is a backdoor to an enterprise's
sensitive and valuable data - and data at rest is often data at
risk.
Other factors are driving demand for secure storage solutions.
Customer Relationship Management applications mean that
organizations are storing more proprietary customer information
than ever before. New privacy regulations in financial services,
health care and other sectors, require organizations to safeguard
that information with increased urgency. In the wake of 9/11,
business continuity and disaster recovery plans are higher
priorities for enterprises, especially in the heavily
data-reliant areas of financial services, utilities, and
government. Offsite storage and remote data backup mean that
valuable corporate data is being replicated in more places, often
outside of the data center, and handled by more individuals.
Increasingly, organizations are sharing their storage facilities
amongst disparate departments and business divisions, raising
concerns about information compartmentalization and protection.
In a recent survey of IT Managers, conducted by Gartner Group and
the investment banking firm SoundView Technology Group, storage
and security were identified as two of the most likely areas for
discretionary IT spending in 2002.
"We are addressing the growing requirement for secure networked
storage with a comprehensive solution, providing end-to-end
confidentiality while maintaining the performance of storage
networks," stated Mr. Venkatacharya. "The Kasten Chase solution
will be interoperable with customers' hardware and software, and
comply with their security policies related to Public Key
Infrastructure and use of cryptographic algorithms.
"One of the biggest obstacles to successfully securing networked
storage has been the "latency," or delay, introduced when massive
amounts of data are encrypted/decrypted during write/read
operations to the storage media," continued Mr. Venkatacharya.
"Through its breakthrough work in applied cryptography, the
Karthika team has designed a solution that accelerates
cryptographic operations to overcome the latency problem."
Kasten Chase anticipates initial revenues from its secure
networked storage solutions in Q4 of this year. Full commercial
release is planned for the first quarter of 2003.
About Kasten Chase
Kasten Chase, a leader in high-assurance data security, provides
enterprises with solutions that build trust and confidence in the
connected world. The company's solutions mitigate risk in the
sharing and storage of sensitive information and enable secure
e-business applications in government, financial services and
health care on a global basis. Certified by the U.S. National
Security Agency and pre-approved by the Canadian Communications
Security Establishment, the company's RASP Data Security(TM)
portfolio protects some of the most sensitive information in the
world. Assurency(TM), Kasten Chase's comprehensive suite of
secure mobile computing solutions, safeguards valuable data
stored on, or transmitted between, mobile computing devices.
Kasten Chase achieved ISO-9001 certification in 1995.
For more information on Kasten Chase, please visit
www.kastenchase.com.
This release may include forward-looking statements with respect
to business plans, activities, prospects, opportunities and
events anticipated or being pursued by the Company. The
realization of the outcomes referred to in such statements
involves a number of risks and uncertainties, including but not
limited to: decisions, or the timing of decisions, made by third
parties over which the Company has little or no control or
influence; the level of interest of customers, employees,
suppliers and investors in the Company and its markets, products
and prospects; the availability of funding for customer purchases
and financing for the Company; changes in economic and market
conditions, industry standards, and government laws and
regulations; as well as other risk factors detailed in the
securities filings of Kasten Chase Applied Research Limited (TSE:
KCA) to which recipients of this release are referred for
additional information concerning the Company and its prospects.
For more information, please contact:
John Carlesso
Kasten Chase
(905) 238-6900 ext. 3315
j.carlesso@kastenchase.com
Assurency, Karthika, KryptoKit and RASP Data Security are
trademarks of Kasten Chase Applied Research Limited. All other
company names, brand names and product names referenced herein
are registered trademarks or trademarks of their respective
owners.
- 30 - |
