LINDON — Altiris Inc. said Wednesday it will acquire a privately held Massachusetts-based company that specializes in security software.
The deal for Pedestal Software involves $65 million in cash for all outstanding shares of Pedestal. Lindon-based Altiris, which specializes in computer system management software, also will assume Pedestal options.
The transaction is expected to close by the end of the month.
"The key difference is that Altiris is now one of a few companies that can do security analysis and vulnerability management and not just tell the customer what the problems are but . . . solve and fix the problem," Greg Butterfield, Altiris president and chief executive officer, said Wednesday on a conference call with analysts and investors.
When the deal closes, Altiris said, it will begin integrating Pedestal products into its existing partner and distribution channels and then scale the Pedestal business in the second half of this year.
The transaction is expected to add $17 million to $18 million in revenue during the 2005 fiscal year. Other details about the financial impact of the move will be announced by Altiris when it reports its first-quarter earnings in April.
Pedestal, which is based in Newton, Mass., has about 50 employees. Its customers include banks, financial service providers, insurance organizations, health-care providers, energy companies, pharmaceutical companies, manufacturers and government entities.
"Altiris solutions are a perfect complement to Pedestal Software's vulnerability management offerings," Jim Geary, president and CEO of Pedestal, said in a prepared statement. "This combination creates a top-to-bottom security management solution for one of the market's most critical pain points. In addition, we expect that our ability to leverage the Altiris brand and channel will help drive our security audit and compliance solutions and accelerate our growth to the front of the market."
Butterfield said the acquisition helps Altiris compete with Symantec Corp., NetIQ Corp. and BindView Development Corp. Another acquisition in the security market is possible this year, he said.
He also said he expects to raise prices on Pedestal products by as much as 20 percent to about $800 per server, computers that run corporate networks, and to about $30 per computer.
Altiris stock fell 33 cents Wednesday to close at $24.41 per share on Nasdaq. During the past year, the price has ranged from $21.10 to $35.81.
Contributing: Bloomberg News
E-mail: bwallace@desnews.com