Utah's Solera Network accepts buyout from Silicon Valley firm
A Silicon Valley Web security firm will acquire South Jordan's Solera Networks in a deal that will add jobs in the Salt Lake Valley.
Blue Coat Systems of Sunnyvale, Calif., is buying Solera, a fast-growing company that makes security products for computer networks. Terms weren't disclosed, but the deal is expected to close June 10, Solera CEO Steve Shillingford said Tuesday.
Solera sells a software "camera" that records and analyzes attacks by malware and hackers intent on damaging computer networks. Started in 2006, the company has 138 employees around the world; about 80 work at Solera's South Jordan headquarters.
Blue Coat is in an adjacent field. It sells devices that sit between the Internet and computer networks, filtering out the threats that governments and companies encounter daily. Blue Coat has close to 15,000 customers, all of which receive notices when any one is attacked, Shillingford said.
"They do most of this out of their Draper office, where they have about 120 employees. They see threats on the Internet literally before anybody else," Shillingford said.
About a year ago, Shillingford and Blue Coat CEO Greg Clark began exploring partnerships that would make the most of their compatible technologies. Under the agreement, announced Wednesday morning in New York, Solera will become a division of Blue Coat, which will use Solera's threat-protection hardware and software to expand further into the security industry.
"So, fundamentally, [when] you put Solera's capabilities [in] advanced malware detection and [its] security analytics [together] with all of the intelligence that Blue Coat is capturing on the Internet, you get their peanut butter and our chocolate combination, which is pretty exciting to both companies," Shillingford said.
Blue Coat has been expanding. In December 2011, it was acquired by private equity firm Thoma Bravo for $1.3 billion. In February, Blue Coat completed its acquisition of network security company Crossbeam Systems. Less than two weeks ago, Blue Coat announced it bought a line of network traffic inspection devices from Netronome Inc.
"One of the other benefits [of the Solera-Blue Coat tie-up], which is sort of geographically based, is Blue Coat's initiative to expand their company [in] engineering and other areas of expertise in the Draper facility. They were looking for a team that could facilitate that," Shillingford said.
"Solera has the majority of its employees headquartered here in our South Jordan facility. So we think it's a great opportunity to put those two groups together, [grow] and build a next-generation security platform," he said.
Clark will be CEO of the merged new endeavor. Shillingford will become senior vice president and general manager of the company's advance threat protection group.
Although the purchase price wasn't revealed, it was enough to win the support of Signal Peak Ventures, said Ron Heinz, managing director of the Salt Lake City-based venture capital firm. Signal Peak, which merged last year with vSpring Capital, was an early investor in Solera.
"It's safe to say that we are pleased as investors in the outcome," Heinz said.
John Vecci, Solera's senior vice president of marketing, said the price was "something the investors and employee owners were very pleased with."
Intel Capital is another investor. Last year the investment arm of Intel Corp. put $20 million into Solera.
Both companies sell computer network security software
Solera: Headquarters is in South Jordan; 138 employees (80 in Utah); customers include Department of Defense, Department of Energy, Hitachi, Cisco, Zions Bank
Blue Coat: Headquarters in Sunnyvale, Calif.; 120 employees in Draper (1,321 total); 15,000 customers, including 86 percent of Fortune magazine's Global 500 firms
Source: Solera, Blue Coat