Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : CyberGuard Corp. (CYBG) -- Ignore unavailable to you. Want to Upgrade?

To: stephen allen who wrote (1649)	6/1/1998 9:15:00 AM
From: stephen allen	Read Replies (1) \| Respond to of 2616

Monday June 1, 7:22 am Eastern Time Company Press Release Cyberguard Corporation Acquires ARCA Systems FT. LAUDERDALE, Fla.--(BUSINESS WIRE)--June 1, 1998 Combining CyberGuard's Security Products and Services with ARCA's Consulting Business Creates the Industry's Leading Enterprise Security Solutions Provider CyberGuard Corporation (NASDAQ:CYBG - news) today announced that it has signed a definitive agreement to acquire Arca Systems, Inc., a privately-held information security services firm headquartered in San Jose, California. This acquisition enables CyberGuard to rapidly broaden the scope of its professional services and establishes the company as a leading provider of enterprise network security products and services. ''By adding Arca's proven security consulting services to our growing portfolio, CyberGuard can now meet a much broader spectrum of our customer's security needs,'' said Robert L. Carberry, chairman and chief executive officer of CyberGuard Corporation. ''We selected Arca Systems for their unparalleled security consulting expertise in both the commercial and government sectors with a customer base that includes companies such as Novell, Oracle, IBM, EDS and Digital Equipment. The long-standing working relationship between our two companies, together with Arca's existing profitability, makes this transaction accretive, moves us closer to profitability, and directly benefits our customers.'' ''We look forward to becoming part of the CyberGuard team and significantly growing the security consulting business'' noted Bill Wilson, president and founding partner of Arca Systems, Inc. ''This transaction allows us to substantially broaden our distribution channels and reach more of the commercial security services marketplace. It also enables us to bring our tools and assessment techniques to market as commercial products.'' CyberGuard's new portfolio of professional services will include Arca's network security consulting services and product/system offerings, CyberGuard's electronic commerce certificate authority outsourcing services, managed firewall services and network security program management services, and a set of fixed-priced individual security services. Arca's capabilities and research programs are also expected to broaden CyberGuard's future product portfolio and provide additional service offerings. ''Security is a significant differentiator in the increasingly competitive consulting market,'' noted Bruce Murphy, partner and National service line leader for the Resource Protection practice at Coopers & Lybrand L.L.P. ''Our Resource Protection Practice brings world-class security offerings to our clients, and enhances our capabilities through strategic alliances such as our relationship with CyberGuard. We look forward to expanding this relationship as CyberGuard brings new offerings to the market.'' Coopers & Lybrand and CyberGuard jointly deployed an eCommerce pilot project for a telecommunications client earlier this year. Arca maintains a leadership position in anti-intrusion and security protocol analysis technologies and is one of the first U.S.- based companies to be certified by the U.S. Government's National Security Agency to conduct independent trusted product evaluations. Arca's 1998 revenues are expected to account for a significant percentage of CyberGuard's calendar 1998 revenues. ''This transaction reaffirms CyberGuard's role as a major player in the network security market,'' noted Jessica Kourakos of SBC Warburg Dillon Read. ''The acquisition should result in an immediate contribution to CyberGuard's revenue stream and allow the company to capitalize on the explosive growth in the security consulting and implementation services market, the fastest growing segment of the overall services market. We estimate this segment of the market to be roughly $250 million in 1998, growing to $450 million in the Year 2000. We consider the acquisition a major strategic move and an excellent opportunity for CyberGuard.'' Under the agreement, CyberGuard will issue approximately 590,000 shares of its Common Stock, valued at $7.8 million, to Arca's shareholders in exchange for the entire equity interest in Arca. This brings CyberGuard's total shares outstanding to approximately 9.4 million. The acquisition will be accounted for under the pooling of interests method and is expected to be accretive. The transaction is expected to close before the end of the quarter and is subject to approval by Arca shareholders and other customary closing conditions. CyberGuard will be hosting an investor conference call to discuss this transaction on Monday, June 1, at 10:30 am Eastern time. If you would like to participate in the call, please dial 303/267-1001. A recording of the call will be available through Tuesday June 9, by dialing 303/804-1855 and entering pass code 315139.