Crossbeam looks to deal

Contact: Brenon Daly

After growing organically to $90m in sales in 2008, Crossbeam Systems is actively looking to acquire a company in the near future, the company said Tuesday at the Montgomery Technology Conference. Crossbeam has been generating cash for more than a year, and currently has some $11m in the bank. It also has an untouched $15m line of credit and indicated that it could raise another round of funding for a significant transaction. (Crossbeam has already raised some $105m in venture backing over the past seven years.)

Although Crossbeam is lumped into the security market, it is a platform – rather than an application – vendor. In fact, it partners with several key security companies, including Check Point Software Technologies, Sourcefire and IBM’s ISS unit. Obviously, it couldn’t buy any single security application vendor without risking the loss of one of those partners. Instead, the company is looking to do a network-related deal, perhaps adding analysis or application acceleration. (However, Crossbeam won’t be considering WAN traffic optimization companies; the company said that market is too crowded.)

As it plans to shop, Crossbeam joins several other large privately held companies, which are all running at more than $50m in revenue, that are currently in the market. We understand that Tripwire may be looking to pick up some security technology, specifically in log management and vulnerability assessment. And, we recently noted that NetQoS is also considering a deal. In fact, we hear that the networking company may be close to a letter of intent on a small transaction, while it also continues to assess a much more significant acquisition.