Commtouch Acquires eleven GmbH to Accelerate Launch of
Security-as-a-Service Solutions
MCLEAN, Virginia, November 19, 2012 /PRNewswire/ --
Commtouch® (NASDAQ: CTCH), a leading provider of
Internet security technology and cloud-based services, today
announced it acquired Berlin,
Germany-based eleven GmbH. The acquisition was completed on
Friday, November 16, 2012.
(Logo:
http://photos.prnewswire.com/prnh/20120501/529254 )
eleven is well-known throughout Germany as the leading provider of mail-based
Security-as-a-Service (SecaaS) solutions, capturing more than 36
percent of the German market for managed email security. In
addition to managed email security and archiving solutions, eleven
also provides advanced on-premise email solutions and services to
selected customers, and its customer base includes some of the
largest organizations in Germany,
including BMW, SAP, Siemens and Deutsche Telekom / T-Online. The
acquisition of eleven enables Commtouch to accelerate delivery of
private label cloud-based security solutions specifically designed
for OEM and service provider markets. In addition, Commtouch's
global reach should accelerate sales and adoption of this leading
security technology developed by eleven.
Commtouch will continue expanding eleven's brand and presence in
Germany, Austria and Switzerland while also supporting the needs of
all of eleven's valued customers, channel partners and distributors
through the combined resources of both companies. Outside of
Germany, Commtouch continues to
focus on its primary OEM business and private labeling of cloud
based Security-as-a-Service solutions.
Commtouch will retain the eleven brand in the DACH region.
Eleven's 60 employees will remain with the company. Robert Rothe, eleven CEO and founder, also joins
Commtouch's executive team as Chief Technology Officer and head of
Commtouch's operations in Germany.
"eleven's proven cloud-based technology delivers tremendous
capabilities that will accelerate Commtouch's strategy to become a
cloud-based Security-as-a-Service solution provider for the OEM and
service provider markets," said Shlomi
Yanai, CEO of Commtouch. "Both the people and the products
at eleven will serve a significant role in our continued effort to
grow Commtouch by offering the most advanced and innovative
security technology. We also look forward to serving all of
eleven's current customers and partners and we are committed to
maintaining its leading stance in Germany. I welcome all of eleven's employees
to the Commtouch family and look forward to the valuable
contributions of Robert Rothe in his
new role as CTO at Commtouch."
"I am pleased to join Commtouch as CTO, and I am excited to
combine the resources and great talent in both companies," said
Rothe. "Through Commtouch's acquisition of eleven, there is a
tremendous opportunity for global growth as Commtouch brings
eleven's award-winning technology to larger markets through its
extensive base of OEM and service provider partners. We look
forward to continuing great service for our existing customers
while also seeing significant benefit in expanding our
opportunities as part of Commtouch."
For the trailing 12-month period ended October 31, 2012, eleven generated revenues of
approximately $8.0 million (€6.3
million) and was profitable. Similar to Commtouch, eleven generates
the vast majority of its revenues from the delivery of services to
its clients on a recurring subscription-based revenue model. The
acquisition of eleven is comprised of three elements: cash, shares,
and an earn-out component based on the success of eleven within the
combined entity. The closing purchase price included net cash
of $9.2 million (€7.2 million) and
approximately $2.1 million worth of
Commtouch restricted shares. The earn-out component will be
paid out through 2015 based on the successful achievement of
certain performance-based revenue goals.
Financial Guidance
With regard to Commtouch's forward looking financial guidance,
based on the acquisition of eleven announced today, the
company's year-to-date results, as well as the company's current
expectations for the remainder of 2012, Commtouch is updating its
outlook. Commtouch is increasing its revenue guidance and now
anticipates full year 2012 revenue will be in the range of
$23.7 million to $23.9 million. The
acquisition will be accretive, with a modest positive contribution
for the current fourth quarter of 2012; accordingly the company is
reiterating its expectation that full year 2012 non-GAAP net income
is expected to be greater than $4.0
million.
The above outlook is as of the date of this release, and the
company undertakes no obligation to update its estimates in the
future.
Conference Call Information
The company has scheduled a conference call for Monday, November 19, 2012 at 10:00 a.m. ET to review Commtouch's acquisition
of eleven GmbH. To participate in the call, please dial one of the
following access numbers 10 minutes prior to the start time of the
call:
US Dial-in Number: 1-877-407-9210
International Dial-in Number: +1-201-689-8049
Israel Dial-in Number: 00-800-4626-6666
at:
10:00 a.m. Eastern Time, 7:00 a.m. Pacific Time,
3:00 p.m. UK Time, 5:00 p.m. Israel Time
The call will be simultaneously webcast live from a link on
Commtouch's Web site at http://www.commtouch.com.
About eleven
A leading email security provider based in Germany, eleven's unique eXpurgate technology
offers a spam filter and email categorization service that reliably
protects users against spam and phishing, detects potentially
dangerous email, and can distinguish between individual messages
and mass emails. eXpurgate also offers numerous virus protection
options and a powerful email firewall. More than 45,000
organizations of all sizes use eXpurgate to check and categorize
more than a billion email messages every day. Customers include
Internet service providers and telecommunication carriers such as
T-Online, O2, 1&1 and freenet as well as many well-known
companies and public institutions, including Air Berlin, BMW, the
Federal Association of German Banks,
DATEV, the Free University of Berlin, Landesbank Berlin, RTL, SAP,
ThyssenKrupp and Tobit Software AG. Visit http://www.eleven.de.
About Commtouch
Commtouch® (NASDAQ: CTCH) is a leading provider of
Internet security technology and cloud-based services for vendors
and service providers, increasing the value and profitability of
our customers' solutions by protecting billions of Internet
transactions on a daily basis. With six global data centers and
award-winning, patented technology, Commtouch's email, Web, and
antivirus capabilities easily integrate into our customers'
products and solutions, keeping more than 350 million end users
safe. To learn more, visit http://www.commtouch.com.
- Blog: http://blog.commtouch.com/cafe
- Facebook: http://www.facebook.com/commtouch
- LinkedIn: http://www.linkedin.com/company/commtouch
- Twitter: @Commtouch
Use of Non-GAAP Measures
Non-GAAP financial measures consist of GAAP financial measures
adjusted to exclude: share based compensation expenses,
amortization and impairment of acquired intangible assets, deferred
taxes, acquisition related costs and adjustments to earn-out
obligations related to acquisitions. The purpose of such
adjustments is to give an indication of the company's performance
exclusive of non-cash charges and other items that are considered
by management to be outside of the company's core operating
results. The company's non-GAAP financial measures are not meant to
be considered in isolation or as a substitute for comparable GAAP
measures, and should be read only in conjunction with the company's
consolidated financial statements prepared in accordance with GAAP.
Company management regularly uses supplemental non-GAAP financial
measures internally to understand, manage and evaluate our business
and make operating decisions.
These non-GAAP measures are among the primary factors management
uses in planning for and forecasting future periods. The company
believes this adjustment is useful to investors as a measure of the
ongoing performance of our business. The company believes these
non-GAAP financial measures provide consistent and comparable
measures to help investors understand the company's current and
future operating cash flow performance. These non-GAAP financial
measures may differ materially from the non-GAAP financial measures
used by other companies. The presentation of this non-GAAP
financial information is not intended to be considered in isolation
or as a substitute for the financial information prepared and
presented in accordance with GAAP. Management uses both GAAP and
non-GAAP measures when evaluating the business internally and
therefore felt it important to make these non-GAAP adjustments
available to investors.
Recurrent Pattern Detection, RPD, Zero-Hour and GlobalView
are trademarks, and Commtouch is a registered trademark of
Commtouch. U.S. Patent No. 6,330,590 is owned by Commtouch.
All other trademarks are the property of their respective
owners.
This press release contains forward-looking statements,
including projections about our business, within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. For example, statements in the
future tense, and statements including words such as "expect,"
"plan," "estimate," "anticipate," or "believe" are forward-looking
statements. These statements are based on information available to
us at the time of the release; we assume no obligation to update
any of them. The statements in this release, including those
relating to how eleven's proven cloud-based system provides
tremendous capabilities that will accelerate Commtouch's launch of
a Security-as-a-Service solution for the OEM market, are not
guarantees of future performance and actual results could differ
materially from our current expectations as a result of numerous
factors, including business conditions and growth or deterioration
in the Internet market, commerce and the general economy, both
domestic as well as international; fewer than expected new-partner
relationships; competitive factors, including pricing pressures;
technological developments, and products offered by competitors;
the ability of our OEM partners to successfully penetrate markets
with products integrated with Commtouch technology; a slower than
expected acceptance rate for our
newer product offerings; availability of qualified
staff; and technological difficulties and resource constraints
encountered in developing new products, as well as those
risks described in the text of this press release and the company's
Annual Reports on Form 20-F and reports on Form 6-K, which are
available
through http://www.sec.gov.
Company
Contact:
Ron Ela, Chief Financial
Officer
Commtouch
(US) +1-650-864-2291 (Int'l)
+972-9-8636813
ron.ela @commtouch.com
Israel Investor Relations Contact:
Iris Lubitch
EffectiveIR
+972-54-252-8007
Iris@EffectiveIR.co.il
U.S. Investor
Contact:
Christopher
Chu
Grayling
+1-646-284-9400
commtouch@grayling.com
Commtouch Media Contact:
Matthew Zintel
Zintel Public Relations
+1-281-444-1590
matthew.zintel@zintelpr.com
SOURCE Commtouch