IBM advances security services position with ISS acquisition


Armonk, NY and Atlanta, GA— IBM continued its buying spree last week announcing it will acquire Atlanta-based Internet Security Systems Inc . (ISS) in an all-cash transaction for about $1.3 billion, or $28 a share. The move is subject to shareholder and regulatory approvals and customary closing conditions. The deal is expected to close in the fourth quarter. The acquisition is IBM's fourth in recent weeks, and at $1.3 billion is the 5th-largest in IBM's history. ISS will join IBM as a business unit within the IBM Global Services Security organization.

IBM sees the move as an important addition to its security and privacy services business, giving it an automated security platform to offer standardized, enterprise-wide preemptive protection against security threats. At a press conference last week, Val Rahmani, general manager, infrastructure management services, IBM Global Services, called ISS 'a strategic and valuable addition to IBM's portfolio' that will help provide companies with 'access to trained experts and leading-edge processes and technology to evaluate and protect against threats and enforce security policies.'

Rahmani said ISS' product line and expertise complement IBM's security efforts. She called the acquisition 'a natural evolution' for the two companies, saying the two share a vision for the security marketplace and are 'perfectly complementary.' ISS and IBM have worked as partners since 1999.

ISS employs about 1,300 worldwide, with some 65% U.S.-based. Headquarters will remain in Atlanta, said Tom Noonan, ISS president and CEO, who remains at the helm in charge of security operations. 'We're going to build the global standard for security right here in Atlanta,' he said, adding he expects no headcount reductions and that the move is about growth, not cost management.

ISS provides security solutions globally designed to proactively protect against Internet threats across networks, desktops, and servers. Its software and services monitor and manage network vulnerabilities and work to respond in advance to potential threats. The acquisition is expected to reinforce IBM's position in the rapidly growing area of managed security services, said to be one of the most complex challenges facing companies of all sizes, locations, and industries.

IBM said once the deal is complete it intends to integrate ISS' software technology with its Tivoli IT service management portfolio and market and sell ISS' managed security services and portfolio of network, application, server, and endpoint protection products through IBM's and ISS' sales channels and business partners.

Click here to read Control Engineering 's coverage of IBM's agreement to buy MRO Software Inc.

—Control Engineering Daily News Desk
Jeanine Katzel , senior editor

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