Rockville software security firm sold

RealNetworks pays $12 million in stock for Aegisoft

January 16, 2001|By Kristine Henry | Kristine Henry,SUN STAFF

RealNetworks Inc., the leading maker of software that allows Internet users to hear music and see video feeds online, said yesterday that it has acquired Aegisoft Corp. of Rockville in a deal valued at about $12 million.

Aegisoft, founded in 1997, develops security technology that is designed to prevent hackers from manipulating Web sites and to prevent outside parties from copying information, such as video clips, and posting them on other sites.

"So, for example, when President Bush makes an address and CNN wants to put it out there, [Aegisoft's technology] will not let somebody else hijack that," said Alexander Saenger, Aegisoft's former vice president of marketing and operations. "It makes the content secure."

Saenger said about half the company's employees will be transferred to RealNetworks' headquarters in Seattle, while the others, including himself, were let go. The company had a staff of 22.

Under the purchase transaction, Aegisoft's equity holders received 1.2 million RealNetworks shares, which are trading at $10, and have the right to receive up to 300,000 additional shares.

RealNetworks warned Dec. 20 that earnings would fall short of analysts' estimates. The company's revised figures projected pro forma diluted earnings per share of 2 cents and revenue in the range of $58 million to $60 million, Reuters reported. Wall Street analysts on average were expecting a profit of 4 cents a share and revenue of $73.52 million.

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