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The Rumor is True - VMware Acquires Blue Lane Technologies

Did you hear about the rumored acquisition of Blue Lane Technologies by VMware?  Well, it's true.  Check out the latest article on the subject over at Virtual Strategy Magazine.  Here is a snippet:

Back in September during VMworld 2008, there was a rumor floating around the event's showroom floor that begged to be verified.  No, I'm not talking about the rumor of Microsoft acquiring Citrix (though that was making its rounds during the show).  Let's take it down quite a few notches on the scale of wearing tin foil hats -- I'm talking about the rumor that VMware acquired the network security vendor Blue Lane Technologies. 

After reaching out to both companies, I recently heard back from VMware, and indeed, they confirmed the rumor to be true.  Although no press release from either company was ever issued, VMware did confirm with me that as of October 2008, the virtualization giant had indeed acquired Blue Lane Technologies for an undisclosed amount. 

So what's all the secrecy about?

Well for one thing, the rumored terms were not particularly favorable for Blue Lane and their investors.  The acquisition amount being thrown around is somewhere in the neighborhood of $10-15 million.  Blue Lane, founded in 2002, has raised $13.4 million to date with two rounds of funding coming from Benchmark Capital, DAG Ventures and Matrix Partners.  And supposedly, even VMware had an investment in the security firm in the amount of $3 million.  Having $13-16 million invested in the company and returning a valuation sale price between $10-15 million adds credibility to the rumors that Blue Lane may have been struggling. 

At some point this year, Blue Lane also lost their outspoken VP of Marketing, Greg Ness, an avid blogger and evangelist for the virtualization, security and Infrastructure 2.0 market - causing further concern and alarm as to the validity that the company was going through rough times.

Read the entire article on Virtual Strategy Magazine to find out more about the acquisition, why the secrecy, what happens next and how does it affect things.

Published Tuesday, November 11, 2008 12:16 PM by David Marshall
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