Monday, August 15, 2005

Citrix Acquires NetScaler for $300 Million -- Application Appliances

Citrix Systems has acquired NetScaler, a start-up based in Santa Clara, California, for its application networking appliances. The transaction is valued at approximately $300 million in cash and stock and includes the assumption of approximately $23 million in unvested stock options.

NetScaler developed a line of Secure Application Accelerator platforms for enterprises. The platforms combine the features and functions of traditional data center point products - load balancing, caching, compression, SSL acceleration, attack defense, SSL VPN - into a single network appliance. NetScaler accelerates the performance of Web browser-based applications and e-commerce and consumer Web sites by as much as 15 times, according to the company.

NetScaler's customers include Google, Amazon, Dow Jones, Earthlink, E*Trade, MSN and Ticketmaster and the company estimates that up to 75 percent of all Internet users go through a NetScaler system each day.

Citrix said the acquisition strengthens its customer value proposition by improving the performance of any application delivered through the Citrix Access Platform, which seamlessly connects users, devices, and networks to enterprise resources.

"With this acquisition, we are extending our best access experience value to the entire range of Web-based applications, including enterprise, browser-based, XML Web services, and others," said Mark Templeton, president and chief executive officer for Citrix.

NetScaler, which was founded in 1998, has approximately 200 employees, including research and development teams in Silicon Valley and India. B.V. Jagadeesh, previously president and chief executive officer for NetScaler, will now report to Mark Templeton as group vice president and general manager.

  • In early 2003, Citrix outlined a strategy to expand its coverage of the overall Access Infrastructure category by penetrating into adjacent high-growth markets such as collaboration and VPN. Since that time, Citrix has completed three acquisitions of best-of-breed companies. In 2004, Citrix acquired Expertcity, now the Online Group, moving the company into the real-time collaboration, desktop access and on-demand assistance market segments. Citrix also acquired Net6, now the Gateways Group, extending Citrix's reach in the SSL VPN (secure socket layer virtual private network) and IP (internet protocol) telephony market segments.

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