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Riverbed Expands IT Performance Business with Acquisition of Zeus Technology

Riverbed Technology, the IT performance company, today announced that it has acquired Zeus Technology, a privately-owned company that delivers high-performance software-based load balancing and traffic management solutions for virtual and cloud environments. The Zeus organization, based in Cambridge, U.K., will become a new business unit of Riverbed, led by the former CEO of Zeus, Jim Darragh. Riverbed also announced today the acquisition of Aptimize Limited, a privately-owned company that is a market leader in web content optimization. The acquisitions of the two companies will form the cornerstone of Riverbed’s asymmetric optimization strategy.

Zeus pioneered the development of software-based highly scalable application delivery controllers (ADCs). The Zeus virtual ADC (vADC) delivers the highest performance, and supports the broadest range of hypervisors, including VMware, Xen, HyperV and KVM. Zeus vADC solutions are used by over 1,500 customers worldwide, including seven of the top 10 telcos, a majority of the leading cloud service providers, major broadcasters, and top media and e-commerce companies.

“Riverbed is the performance company,” said Jerry Kennelly, president and CEO at Riverbed. “Our goal is to have the broadest and best portfolio of performance optimization products to solve a range of customer performance problems. The acquisition of Zeus is a perfect fit with that strategy. The Zeus solutions are designed for how people want to architect their applications now—high-performance software for cloud environments.”

Zeus approached product development differently by architecting a software-based ADC. As a software-based solution, the Zeus vADC has many advantages over its hardware-originated peers: it is better suited for virtual and cloud environments, it can migrate across environments, and it can scale on demand. In addition, because it is integrated into the application stack, IT organizations can more flexibly script, automate and deploy the Zeus vADC than is possible with legacy hardware-based approaches. In addition, there is great potential for integrating both symmetric and asymmetric acceleration approaches in order to deliver the best solution for performance in both private and public cloud environments.

“According to industry analysts, the virtual ADC market is expected to grow about four times faster than the traditional ADC market over the next 4 years,” continued Kennelly. “Zeus is well positioned within this market as customers look for ADC solutions for public and private clouds that truly integrate into their application stack.”

Under terms of the acquisition, Riverbed will pay approximately $110 million in cash for the securities of Zeus and up to an additional $30 million in cash based on the achievement of certain bookings targets in a defined twelve month period following the closing. The acquisition is expected to be approximately breakeven to Riverbed earnings in the second half of 2011 and accretive beginning in 2012.

“Riverbed is a strong technology player with a proven solution for global enterprises,” said Darragh. “There is great synergy between our technologies, employees and corporate strategies, and we share Riverbed’s vision of delivering performance solutions for all applications.”

More than 13,000 organizations worldwide, across a wide range of markets, depend on Riverbed to understand, optimize and consolidate their IT infrastructure. Riverbed delivers hardware, software and virtualized solutions that overcome performance issues caused by distance, distributed computing, and ever increasing amounts of data. Virtualization, consolidation and cloud computing promise huge cost savings and improved efficiencies, but as users move farther from their data, slow applications and file transfers can stall these strategic initiatives. Riverbed delivers to the remote office and mobile workers the same “local area network (LAN)-like” performance, no matter where the private data center or public cloud may be. Riverbed continues building on its success in the WAN optimization and network performance management (NPM) markets with new and innovative solutions for accelerating cloud storage and access to applications and data deployed in public, private and hybrid clouds.

Published Tuesday, July 19, 2011 6:32 PM by David Marshall
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