Summary
F5, INC. (FFIV) announced on June 2, 2004, the acquisition of MagniFire Websystems, Inc. for $29 million in cash. This strategic move, financed through existing cash reserves, brings MagniFire's web application firewall product line and associated assets under F5's umbrella. The transaction is structured as a merger, with MagniFire becoming a wholly-owned subsidiary of F5. While the acquisition is expected to be slightly dilutive to F5's earnings per share by approximately $0.02 in the current quarter and will impact earnings through the first half of fiscal 2005, the company anticipates MagniFire-related product sales to contribute between $8 million to $12 million in revenue for fiscal 2005. F5 expects to reach breakeven results from MagniFire's operations by the third quarter of fiscal 2005, indicating a medium-term integration and revenue ramp-up plan.
Key Highlights
- 1F5, Inc. acquired MagniFire Websystems, Inc. for $29 million in cash on May 31, 2004.
- 2The acquisition was financed using F5's existing cash reserves.
- 3The deal was structured as a merger, making MagniFire a wholly-owned subsidiary.
- 4F5 gains MagniFire's web application firewall product line and related assets.
- 5The acquisition is expected to contribute $8 million to $12 million in revenue in fiscal year 2005.
- 6The acquisition is projected to be dilutive by approximately $0.02 to EPS in the current quarter.
- 7Breakeven results from MagniFire operations are anticipated in the third quarter of fiscal 2005.