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Spirent Communications has entered into a definitive agreement to acquire privately held Mu Dynamics, a security testing firm based in California.
Mu specialises in developing security solutions that enable faster, higher quality deployments of Cloud applications and applications-aware networks.
Spirent will pay a cash consideration of $40.0m for Mu and expects Mu to contribute $9.0m to $10.0m in revenue in 2012, with a positive return on sales.
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For the first full year of ownership Mu's revenues are expected to be in the range of $17.0m to $19m operating at Spirent's average return on sales, providing an uplift to earnings and achieving an attractive return on investment, the group said.
Spirent said it remains committed to selling, supporting and enhancing Mu's existing product portfolio, and thinks that it can grow Mu's sales by taking advantage of Spirent's existing global sales channels.
Further benefits will be realised through the integration of Mu's differentiated capabilities into Spirent's performance test platforms, accelerating the growth rate for Spirent's networks and applications product line.
"Mu Dynamics brings additional market-leading expertise in cyber security, usability and application emulation to the Spirent solutions portfolio. Combining Mu's software-based applications and security testing capabilities with Spirent's test platforms will enable us to rapidly create best-in-class security test solutions with higher performance and greater scale than any other provider," Spirent's Chief Executive Officer, Bill Burns, said.
"This acquisition aligns with our strategy of delivering profitable growth through expanding our capabilities in growing and emerging technology markets."
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Get the latest financial news, insights and expert analysis from our award-winning MoneyWeek team, to help you understand what really matters when it comes to your finances.
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