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1/24/2003
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Cisco Buying Desktop-Security Firm For $154M

Cisco says the purchase would give it the most comprehensive portfolio of products that secure large corporate networks.

Network-equipment maker Cisco Systems is buying privately held security-software firm Okena Inc. in an all-stock deal valued at about $154 million. Okena makes intrusion-prevention software for desktops and servers. Cisco says the purchase would give it the most comprehensive portfolio of products that secure large corporate networks.

The buyout, already approved by both companies' boards, is expected to close by this summer.

Joel McFarland, manager of security platforms in Cisco's VPN and security business unit, says Okena's apps will let Cisco reach beyond servers to networked desktops with security software. He says Okena's desktop intrusion-prevention software is a fit for Cisco's desktop client apps, such as its VPN software.

Analysts aren't so sure. "We don't believe Cisco is the place to buy security software," Gartner security analyst John Pescatore says. "Their strength is in embedding security into network devices."

"The challenge will be for Cisco to convince buyers that Cisco is a legitimate player on the host-security market," says Pete Lindstrom, research director with Spire Security. It is, however, "a great deal for Okena. They have solid technology," he says.

Pescatore hinted that Cisco is overpaying for Okena. It's "just an enormous valuation. We think there were other suitors for Okena."

Okena recently won the opportunity to bundle portions of its software with certain Unisys servers.

Okena's intrusion-prevention software stops both known and unknown attacks by blocking malicious behavior.

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