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McAfee to acquire email SaaS vendor MX Logic

McAfee will acquire MX Logic, one of the few remaining independent email security SaaS vendors, for $140 million in cash in a deal announced Thursday.

Security giant McAfee Inc. will acquire MX Logic Inc., one of the few remaining independent email security SaaS vendors, for $140 million in cash in a deal announced Thursday.

Englewood, Colo.-based MX Logic's services will complement the email and Web security capabilities McAfee brought on board when it acquired Secure Computing last November. Secure Computing offered the IronMail line of email security appliances, as well as Web security gateways.

This announcement also puts McAfee eyeball to eyeball with arch rival Symantec Corp., which acquired the other remaining large email security SaaS vendor, MessageLabs last October. Google is a major competitor as well, based on the Postini deal in 2007. (Microsoft bought another major player, FrontBridge Technologies Inc., in 2005.)

"This complements IronMail," said Melissa Siems, McAfee's director of marketing for Software as a Service. "We have customers who are interested in a hybrid delivery model; an appliance to filter outbound email, and a SaaS solution to do inbound filtering in the cloud."

Siems also said that MX Logic brings email archiving and continuity services to McAfee,; services their customers have been demanding.

McAfee enterprise customers, in particular, will benefit from the hybrid model, Siems said.

Enterprises often prefer to keep control of outgoing email to protect content through data leakage prevention and encryption, but turn inbound filtering to a SaaS provider to offload antispam and antivirus. Smaller companies, in particular, are turning towards SaaS for both inbound and outbound filtering, she said.

MX Logic has more than 40,000 customers with more than four million end users.

"Overall I think it's a pretty good deal for McAfee," said Peter Firstbrook, a research director at Stamford, Conn.-based Gartner Inc. "They desperately needed to get into that SaaS market given Symantec was already there with MessageLabs."

With the acquisition, he added, McAfee has three email products with no commonality across them, so the vendor has some integration work to do.

Andrew Braunberg, a research director at Washington, D.C.-based research firm Current Analysis Inc., said: "McAfee is riding two important trends in the security market with this deal: the need for broader SaaS offerings and the continued strength of the content security segments of the market.

"The MX Logic portfolio will complement McAfee's existing Artemis cloud service, which is chiefly targeted at augmenting its endpoint products," Braunberg added, "but the company will have to rationalize the new MX Logic services with its existing Email Security Service, and Web Protection Service."

The acquisition also brings some 1,800 MX Logic channel partners into McAfee, which has some major program integration work ahead of it already with the Secure Computing channel. McAfee, however, already has a strong SaaS program, which should help smooth the path.

The deal is expected to close this quarter, McAfee said.

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