Fortinet rides to troubled Meru's rescue
Adding cloudy WLAN to wireless security portfolio
Troubled WLAN vendor Meru Networks has found a rescuer in security vendor Fortinet, which is buying the company for US$44 million.
The acquisition will bring Meru's wireless SDN capabilities alongside Fortinet's core, edge and access security portfolio, Meru says in this canned statement.
Meru has been on a long downward trajectory. In January, it called on Deutsche Bank to help it decide what to do in the long term, and lopped 10 per cent of its workforce as a short-term measure.
In spite of touting itself as a lead player in SDN-based WLAN architectures, the company has long been an under-performer in an environment of single-digit WLAN growth but strong “cloudy WLAN” sales. In 2013, then-shareholder Capital Union Partners demanded that the board prepare to sell the company.
Meru's poor sales delivered a net loss of $20.9 million in 2014 on revenues of $90.9 million.
Fortinet pitches itself is a 750-pound gorilla bulking up to hit the 800-pound mark: its 2015 first quarter included a declining GAAP margin (0.4 per cent compared to 8 per cent for Q1 2014), although revenue grew in the year by 26 per cent to $212.9 million.
However, the buyer reckons Meru's technology will sit well alongside its FortiAP access points and FortiWiFi security appliances, which it says are “among the fastest growing products” in its advanced technologies portfolio. ®