Avocent Takes LANDesk For $416M
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Avocent, which supplies network connectivity gear to various businesses, agreed to purchase management software maker LANDesk Group for $416 million in cash and stock.
The deal, expected to close in the next 60 to 75 days, will include $200 million in stock, $200 million in cash and $16 million in options. The transaction value may be increased by up to $60 million if LANDesk meets certain financial targets.
Avocent, which also reported today that sales for the first quarter increased 23.1 percent to $94.5 million, makes switches and certain pieces of software to connect hardware in a data center.
The Salt Lake City, Utah, company's LANDesk Management Suite and LANDesk Security Suite allow IT administrators to control their machines from a single computer.
By combining the hardware connectivity strengths of Avocent and the breadth of LANDesk's desktop management suite, the companies hope to come to the bargaining table with enough products to give IT managers control of all of their IT equipment.
Avocent said in a statement that LANDesk is already a partner and hopes to benefit from the company's long-term strategic relationships with Lenovo, Intel and other major original equipment manufacturers.
LANDesk, which has grown its revenues 25 percent per year since leaving Intel, has about 500 employees. Most of them will join Avocent.
"Avocent enhances the product suite and services that we can provide our customers and strategic partners," said Joe Wang, president and CEO of LANDesk, on a conference call.
"LANDesk will preserve its organizational identity while becoming part of a well-capitalized enterprise with excellent prospects for accelerated growth."
In related merger news, hosting and integration player AttachmateWRQ today agreed to pay $495 million in stock for security and management software maker NetIQ.
When the deal closes in three months, the combined company will boast over $400 million in sales as the newly named Attachmate-NetIQ.
Today's bids for LANDesk and NetIQ are the latest examples of consolidation in the broad, multi-billion-dollar space for management software.
CA kicked off 2006 by agreeing to acquire application management specialist Wily Technology for $375 million.
Mercury Interactive followed that up a week later by agreeing to purchase service-oriented architecture governance provider Systinet.