Late yesterday Cisco Systems Inc announced it was to pay around $124m to acquire privately-held WheelGroup Corp of San Antonio, Texas. Under the terms of the acquisition, between 1.8 and 2.0 million shares of Cisco common stock will be exchanged for the outstanding shares and options of WheelGroup. Cisco says it will take a one-time charge against after-tax earnings of between $.08 and $0.13 per share for purchased-in-process research and development expenses in the third quarter of fiscal 1998. WheelGroup develops what it calls intrusion detection and security scanning software products. The software operates with network routers and switches as real-time ‘sensors’ to identify and respond to unauthorized intrusions and hackers. WheelGroup’s scanning technology identifies network security gaps throughout the enterprise and offers solutions for closing them. Cisco says it will call the detection and scanning technology active audit.
