NetScout to buy Network General for $205 million

NetScout Systems has announced its intention to acquire Network General for $205 million (£102 million).

The deal, comprising six million shares of NetScout stock, $50 million (£25 million) of cash and $100 million (£50 million) of debt financing, comes after 20 years of competition between the network performance software developers.

NetScout, founded in 1984, specialise in pre-event real-time monitoring and troubleshooting technology. Network General began its operations in 1986 with the shipment of the first Sniffer network monitoring system. Since then, it has expanded its range to a full line of IT network analysis solutions.

"Today, we are bringing together two established companies with complementary technologies to form a new stronger organisation that will have the scale, technology, and mindshare to meet some of the greatest challenges associated with virtualisation, convergence, SOA and highly distributed network-centric operations," said Anil Singhal, president and chief executive of NetScout.

This purchase is the third in a line of exceedingly unsuccessful and unprofitable ownership changes for Network General, the first of which came from McAfee in 1997 for $1.1billion (£550 million). The second change of ownership took place in 2003 when private equity company Silver Lake Partners paid $213million (£106 million) to date the business private. It took Network General and McAfee just under six years to flounder eighty percent of the company's previous value.

NetScout hopes its $205million purchase will prove to be more profitable than those of their predecessors. In a statement released early Thursday, NetScout officials claimed that the acquisition will double revenue by 2009.

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