October 5, 1999 7:54 AM PDT
Intel to buy IPivot for $500 million
Intel Corp (Nasdaq: INTC) said Tuesday it would buy privately held IPivot in an all-cash transaction for $500 million to speed up its e-commerce web traffic.
Intel shares were up 1/16 to 77 1/16 Tuesday morning. Titan shares were up 1/16 to 16.
The Poway, Calif.-based IPivot designs and manufactures "Internet commerce equipment that helps to ensure faster and more secure transactions. Its products will supplement Intel's network equipment expertise in switches, routers and servers -- and improve response times.
The acquisition marks Intel's eighth networking and communications related acquisition this year. Intel built up its Internet commerce equipment for small businesses through the purchase of Dayna Communications in 1997 and "virtual private network" capabilities through the purchase of Shiva Corporation last year.
Intel bought the telecom component products (TCP) division of Stanford Telecommunications, September 23, indicating it is not slowing down in its charge to become the major supplier of silicon for Internet networking and communications products.
Titan Corporation (NYSE: TTN) created technology spin-off IPivot (formerly Serv-Now NetTechnologies) in 1996 to commercialize a concept developed in Titan's software business unit.
Titan said it expects to receive about $41 million in cash in the fourth quarter of fiscal year 1999 as a result of the acquisition by Intel. The cash payment to Titan is for its ownership interest in IPivot of approximately 8 percent after the dilutive impact of IPivot stock options, warrants and other equity instruments.