Ixia to buy Net Optics for $190M cash

Test and measurement equipment specialist Ixia (NASDAQ: XXIA) has agreed to buy privately held Net Optics, Inc., which supplies “total application and network visibility solutions.” Ixia will pay $190 million in cash for the company in a deal expected to close in the fourth quarter of this year. Ixia says the price is subject to adjustments based on Net Optics’ net working capital at closing.

Test and measurement equipment specialist Ixia (NASDAQ: XXIA) has agreed to buy privately held Net Optics, Inc., which supplies “total application and network visibility solutions.” Ixia will pay $190 million in cash for the company in a deal expected to close in the fourth quarter of this year. Ixia says the price is subject to adjustments based on Net Optics’ net working capital at closing.

Founded in 1996, Net Optics' products include network and virtualization taps, Application-Aware Network Performance Monitoring (AA-NPM) offerings, and network packet brokers. These include the Best of Interop Finalist Spyke network visualization product; Phantom Virtualization Taps, which the company asserts were the first to bridge physical and virtual environments; and the Flex Tap, which the company claims was the first to accommodate 100G. Ixia expects to leverage Net Optics’ active monitoring capabilities with their patented inline and bypass technologies, which Ixia says go beyond passive network monitoring to deliver high availability of security and monitoring tools.

Net Optics reported revenue of $49 million in 2012. In the first nine months of 2013, the company’s revenues grew 21% versus the same period in 2012, reaching $42 million; Q3 revenue growth of 31% year-over-year reached a record $15.5 million. Ixia expects the acquisition to be accretive to non-GAAP earnings by the second full quarter after the acquisition closes.

“Next-generation cloud providers, mobility operators, and enterprises demand more visibility into their global networks in order to maintain quality of service across virtualization, application, and service delivery,” said Errol Ginsberg, Ixia chairman and acting CEO. “The acquisition of Net Optics solidifies our position as a market leader with a comprehensive product offering including network packet brokers, comprehensive physical and virtual taps, and application aware capabilities. Additionally, the acquisition strengthens our service provider customer base, increases our footprint in the enterprise, and broadens our sales channel and partner programs.”

Eldad Matityahu, Net Optics' founder and chairman of the bBoard, added, "We are so excited to be acquired by Ixia because Ixia shares our strong commitment to 'Customers First!' values and fosters an innovative culture similar to ours. The combined strengths of our companies will provide customers the strongest and broadest set of network visibility solutions to anticipate evolving network demands."

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