Google to acquire Postini for £312m

Google is set to branch out into the IT security market, buying IT security services company Postini for $625 million (312 million) in cash.

The deal will see the security company become a wholly owned subsidiary of the search giant and Google will use Postini's products and services to secure its existing web-based products. The deal is expected to complete at the end of the third quarter this year and is subject to customary closing conditions. Postini sells hosted security products such as email security, IM security, message archiving and encryption as well as policy-enforced TLS.

Google's chief executive Eric Schmidt said that the deal reinforced his company's commitment to hosted applications and their security.

"With the addition of Postini, our apps are not just simple and appealing to users - they can also streamline the complex information security mandates within these organizations," said Schmidt.

Dave Girouard, vice president and general manager at Google Enterprise said that large businesses have been reluctant to move to hosted applications over security and compliance problems. "By adding Postini products to Google's technology, businesses no longer have to choose - employees get the intuitive products they want, and the company achieves the security and assurance it needs," he said.

Google has assured customers using Postini's products and services that the search giant has no plans to change Postini's current product line up.

"We share a commitment to providing enterprise customers with compelling technology alternatives. This is an exciting milestone, one that will certainly lead to the next level of rapid innovation," said Quentin Gallivan, president and chief executive of Postini.