Network Associates adopts new name
Published: 23 Apr 2004 10:40 BST
Security specialist Network Associates is changing its name and selling one of its product lines in a move to boost profitability.
The company announced on Thursday that it is changing its name to McAfee, the name of its most prominent product line and the name of a company that Network Associates acquired. In addition, it will sell its Sniffer line of manageability tools to Silver Lake Partners and Texas Pacific Group for $275m (£155m) in cash.
Silver Lake and Texas Pacific will then form a new company, called Network General. Both companies are known as turnaround artists. Silver Lake, for instance, helped Seagate go private, and then public again.
With the sale of Sniffer, Network Associates will focus primarily on security and detection.
Security is one of the hotter markets in technology today. Network Associates is currently profitable and has seen an 11 percent increase in revenue. Still, it is making the changes to get to a 25 percent operating margin by the middle of next year. Along with selling of the Sniffer line, the company will try to streamline operations to cut costs.
"This company is engaged in the most aggressive and important transformation in its history," George Samenuk, chief executive of Network Associates, said in a statement. "Today's announcements demonstrate our commitment to increase shareholder value by streamlining our business and accelerating profit and growth. These changes will transform us into a more powerful, more profitable, and more competitive company for the future."
The company also said first-quarter net revenue is expected to be $217m, with net earnings expected to be 32 cents a share. Results from the first quarter will be announced on 27 April.
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