Packeteer Picks Up Tacit for $78M

Packeteer hopes to benefit from Tacit Networks' expertise in WAFS and their relationships with Microsoft and Brocade.

WAN optimization provider Packeteer on May 9 sought to extend its business into the wide-area file services arena when it announced its plans to acquire Tacit Networks for $78 million.

Packeteer, which had already established a reseller agreement with the South Plainfield, N.J., company last fall, found Tacit to be a more strategic play for its WAN optimization and traffic management product portfolio.

"Increasingly, corporations are consolidating servers from the branch office into the data center to get better control of their data, address compliance issues and reduce the cost of managing infrastructure in the branch office," said Mark Urban, director of product marketing at Packeteer in Cupertino, Calif.

"It really changes dynamics of how you deliver applications to the branch office."

The privately held Tacit provides more than just WAFS. It has combined multiple functions in its appliance to create a branch-in-a-box that provides acceleration of Microsofts CIFS (Common Internet File System) applications, WAFS and other acceleration technologies along with branch office server replacement functions such as Domain Name System, Dynamic Host Configuration Protocol, file and print services.

/zimages/1/28571.gifTo read more about Tacit Networks, click here.

Tacit brings to the table key relationships with Microsoft, which yielded a Tacit product built on Microsofts embedded platform, and with Brocade Communications, which is an investor in Tacit and an OEM partner.

As a part of its acquisition, Packeteer struck a deal with Brocade to become Packeteers exclusive OEM distributor for WAFS products.

Tacit also brings along its acquisition earlier in 2006 of Mobiliti, which provided virtual networking, backup and synchronization, and WAN optimization software for Windows desktops.

Packeteers first order of business, once the acquisition closes later in the second quarter, is to integrate its central management tools with the Tacit appliances to reduce the complexity of deploying a larger number of appliances to remote sites.

"Remote management is a big issue and weve been tackling it for the last few years. Well make it easier to scale larger deployments to drive down [total cost of ownership] when youre talking about hundreds of units," said Urban.

Packeteer does not plan any layoffs with the Tacit acquisition, and it intends to maintain Tacits facilities in South Plainfield.

In addition to the $78 million purchase price, Packeteer agreed to assume vested and unvested Tacit stock options, which will be exercisable for an aggregate of approximately 300,000 shares of Packeteer Common Stock.

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