Tech Industry

VeriSign buys SecureIT

The provider of digital certificates announces that it has acquired privately held SecureIT, an Internet-related security service.

VeriSign, a provider of digital certificates, announced today that it has acquired privately held SecureIT, an Internet-related security service.

VeriSign shares were up $1 at $42.5. The stock has traded as high as $49 and as low as $20.5 during the past 52 weeks.

VeriSign expects the acquisition to extend its ability to provide digital certificates applications for secure email, intranet, extranet, and e-commerce. Digital certificates serve as electronic IDs and control access to sensitive data. In addition, digital certificates are increasingly used in credit card transactions.

"This is a very positive acquisition," said analyst Danny Rimer of Hambrecht & Quist. "Our concern has been that given the pickup of demand...how was VeriSign going to be able to address that kind of growth? We were urging the company to do something in services. We see this as a very strategic and beneficial acquisition for VeriSign."

SecureIT's applications allow companies to securely use electronic commerce and communications applications. Its clients include AT&T, CheckFree, and General Electric.

"Enterprises worldwide are beginning to realize the power and economic benefits of using secure Internet-based solutions for business-critical applications such as electronic document exchange, supply chain management, and customer support," said Stratton Sclavos, president and CEO of VeriSign. "Our customers are now accelerating their deployment plans for these applications and are looking for the kind of security expertise and implementation support that SecureIT delivers."

VeriSign plans to offer SecureIT's services through both direct and indirect sales.

VeriSign issued approximately 1,666,000 shares of its common stock to purchase all of the issued and outstanding capital stock of SecureIT. VeriSign has also assumed SecureIT's outstanding employee stock options. The transaction will be accounted for as a pooling of interests.