Light Reading

Juniper to Acquire Kagoor

Light Reading
News Analysis
Light Reading
3/29/2005
50%
50%

Thumbing its nose at all the acquisition rumors of the past several months, Juniper Networks Inc. (Nasdaq: JNPR) today agreed to buy Kagoor Networks, a vendor of session border controllers, for $67.5 million in cash.

The deal indicates the importance of session controllers in service providers' plans. It also could signal a buying frenzy in the session border controller space, which has long been ripe for some acquisitions.

Juniper expects to close the acquisition in the second quarter of 2005.

During the past year, Juniper has been rumored to be on the hunt for an Ethernet company, a wireless company, a Layers 4-7 player -- almost everything but a session border controller vendor. "The rumor mill does run rampant, but we can't comment on its accuracy," says Christine Heckart, Juniper vice president of marketing (see Juniper's Slow Shopping Trip ).

But session border controllers fit into Juniper's Infranet Initiative, which involves bringing better security and reliability into applications such as VOIP.

"What session border controllers do is help you deliver better security, better quality, and better interoperability across IP networks, specifically for voice calls and other real-time media applications," Heckart says.

Juniper thought Kagoor had the best technology available, but it was also a good fit in terms of relationships. Kagoor has about 100 customers and "pretty near 100 percent overlap" with Juniper's roster. Kagoor also works with the same resellers as Juniper, namely Lucent Technologies Inc. (NYSE: LU), NEC Corp. (Nasdaq: NIPNY; Tokyo: 6701), and Siemens AG (NYSE: SI; Frankfurt: SIE). (See Kagoor Gets Hot With Lucent.)

The deal "is good for Juniper for the portfolio fit and because it strengthens their links to two major incumbent voice vendors, Siemens and Lucent," says Graham Beniston, analyst with Heavy Reading, Light Reading's paid research arm.

But as glitzy as its sector is, Kagoor hasn't exactly become a powerhouse. Its revenues were less than $5 million last year, according to Juniper's press release, and the company isn't profitable yet.

A couple of Kagoor's competitors that didn't want to go on record with their comments characterized the price Juniper paid as being on the upper end of what the company was worth, given its revenues.

Kagoor officials did not return calls requesting comment.

Analysts say it's no surprise that Juniper would want a session border controller, because the devices are becoming critical to IP deployments. "The Internet is not the driver any more," says Tom Nolle, consultant with CIMI Corp. "Most of the IP deployments are going to be built around some kind of service mission, and voice is going to be a big part of that." Nolle also sees a need for session border controllers, as service providers try to mold IP to their needs, with something less "permissive" than the Internet. He cited one large European carrier that has vowed not to use the plain Internet peering model to connect to any other providers. "They're going to have a policy gateway on any interconnection they have," Nolle says.

The Kagoor buy could trigger a long-expected avalanche of session border controller acquisitions. After all, it's a hot sector populated with plenty of startups. "Carriers of all shapes and sizes see a need for session border control, which means the prospects for SBC specialist vendors are generally bright," Beniston wrote in a recent Heavy Reading report, "VOIP Session Border Controllers." "We have expected, as many others have, that 2005 will be the year that we see SBC companies getting acquired," says Joel Fisher, vice president of marketing and business development for Jasomi Networks. "Jasomi has seen interest from potential acquirers on an ongoing basis for over a year."

Of course, an IPO is another possibility for session border controllers, given the hype surrounding VOIP. Earlier this month, Kagoor VP of marketing Jim Greenway noted his company would be "looking into it." (See Session Controllers Stir IPO Interest.)

— Craig Matsumoto, Senior Editor, and Mark Sullivan, Reporter, Light Reading




For more on this topic, check out:

For further education, visit the archives of related Light Reading Webinars:

(2)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
DragonsLayer
50%
50%
DragonsLayer,
User Rank: Light Beer
12/5/2012 | 3:21:07 AM
re: Juniper to Acquire Kagoor
I'm interested in what other companies are likely to be acquired in 2005. The session border controller space as noted in the LR article is prime for further consolidation with Jasomi, Acme and Netrake being my picks for potential acquisitions in 2005.

There really aren't any pure play media gateways or softswitches anymore but the services layer (application and media servers) driven by the excitement around IMS are other segments of the VOIP ecosystem which I think are ripe for some consolidation. Anyone have any views/guesses on who might go next in any of these spaces and who are the likely suitors?
laserbrain2
50%
50%
laserbrain2,
User Rank: Light Beer
12/5/2012 | 3:21:02 AM
re: Juniper to Acquire Kagoor
Gotta like seeing them get 13x sales!
From The Founder
Light Reading sits down at CES with the head of Cisco's service provider video business, Conrad Clemson, to discuss how NFV and cloud security relate to video, the challenge of managing 4K/8K traffic, the global expansion of Netflix and virtual reality.
Flash Poll
Live Streaming Video
CLOUD / MANAGED SERVICES: Prepping Ethernet for the Cloud
Moderator: Ray LeMaistre Panelists: Jeremy Bye, Leonard Sheahan
Between the CEOs
CEO Chat With Level 3's Jack Waters

2|8|16   |   26:15   |   (0) comments


Light Reading CEO and founder Steve Saunders sits down with Level 3 Communications' CTO Jack Waters to discuss hot topics like virtualization, 4K and the future of telecom...
LRTV Custom TV
The Composable Telco

2|8|16   |   24:46   |   (0) comments


Heavy Reading's Principal Analyst Caroline Chappell presents the keynote at Light Reading's 2020 Vision Executive Summit in Dublin.
LRTV Custom TV
Join Us at the Digital Operations Transformation Summit

2|4|16   |   03:52   |   (0) comments


The Digital Operations Transformation Summit on February 21, 2016 at the Crowne Plaza Barcelona Fira Centre will bring together 50 senior executives to engage in a unique debate on the opportunities and challenges presented by the transformative evolving digital landscape. RSVP now at events@lightreading.com.
LRTV Custom TV
Making the Test: ADVA Ensemble Connector vs. Open vSwitch

2|4|16   |   01:28   |   (0) comments


Light Reading, in partnership with EANTC, recently tested ADVA's Ensemble Connector, which replaces open vSwitch and offers carrier-grade capability and interoperability. The test results strengthen ADVA's credibility as a provider in the virtualization space.
LRTV Custom TV
Bridging the Gap Between PoCs & Deployment in NFV

2|4|16   |   31:50   |   (0) comments


Charlie Ashton of Wind River presents the keynote at Light Reading's 2020 Vision executive summit in Dublin.
Between the CEOs
CEO Chat With Mike Aquino

2|3|16   |   17:34   |   (0) comments


The former CEO of Overture Networks, Mike Aquino, discusses why truly open virtualization solutions provide service providers with the greatest choice.
Shades of Ray
MWC: Buckle Up for 5G & the IIoT

2|2|16   |   02:28   |   (0) comments


This year's Mobile World Congress looks set to be a 5G land grab and a chance to get down and dirty with the Industrial Internet of Things (IIoT) – but what will the 5G discussions actually be about?
LRTV Custom TV
Case Study: Building China's Next-Gen TV Networks

2|2|16   |   5:01   |   (0) comments


With over 2 billion viewers worldwide, Shenzhen Media Group is one of China's largest content producers. By partnering with Huawei and Sobey, SZMG was able to modernize media operations with the Converged News Center, a production studio that is a model for next-generation workflows.
LRTV Custom TV
Quad Channel Modulator Driver with 46 Gbaud Capability from MACOM

1|28|16   |     |   (0) comments


MACOM's MAOM-003427 is the industry's first surface-mount modulator driver with 46 Gbaud capability to support next generation 200G and 400G applications.
LRTV Custom TV
Video Infographic: Validating Cisco's NFV Infrastructure

1|26|16   |   02:24   |   (1) comment


We all know that the network of the future will be virtual, but when will virtual become a reality? This video infographic covers the four key areas in which Light Reading, in partnership with EANTC, tested Cisco's NFV infrastructure: performance, reliability, multi-service capabilities and single pane of glass management.

For the full report, see

Between the CEOs
CEO Chat With Phil McKinney, CableLabs

1|22|16   |   13:36   |   (1) comment


At CES in Las Vegas, we met with Phil McKinney, CEO of CableLabs. Phil provides an update on the rollout of DOCSIS 3.1, his views on the future of open source and how consumer interest in virtual reality could affect network traffic.
Between the CEOs
Ericsson CTO on the Changing Telecom Market

1|21|16   |   10:26   |   (0) comments


At CES 2015, CTO of Ericsson, Ulf Ewaldsson, sits down with CEO of Light Reading, Steve Saunders, to discuss the changing telecom market, the new partnership with Cisco and the future of the telecom industry.
Upcoming Live Events
March 10, 2016, The Cable Center, Denver, CO
April 5, 2016, The Ritz Carlton, Charlotte, NC
May 23, 2016, Austin, TX
May 24-25, 2016, Austin Convention Center, Austin, TX
All Upcoming Live Events
Hot Topics
Did Juniper Pay 'Peanuts' for BTI?
Mitch Wagner, West Coast Bureau Chief, Light Reading, 2/2/2016
Google's 5G Radio Ambitions Are Expanding
Dan Jones, Mobile Editor, 2/5/2016
Vodafone: Flexible Work Policies Boost Profits
Sarah Thomas, Editorial Operations Director, 2/8/2016
WiCipedia: Faulty Feminism, Worthy Women & Peculiar Perks
Sarah Thomas, Editorial Operations Director, 2/5/2016
Cincinnati Bell Joins Weight Watchers Club
Alan Breznick, Cable/Video Practice Leader, 2/5/2016
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
Light Reading CEO and founder Steve Saunders sits down with Level 3 Communications' CTO Jack Waters to discuss hot topics like virtualization, 4K and the future of telecom...
The former CEO of Overture Networks, Mike Aquino, discusses why truly open virtualization solutions provide service providers with the greatest choice.
Animals with Phones
Happy Groundhogs for Technology Day! Click Here
Live Digital Audio

Broadband speeds are ramping up across Europe as the continent, at its own pace, follows North America towards a gigabit society. But there are many steps to take on the road to gigabit broadband availability and a number of technology options that can meet the various requirements of Europe’s high-speed fixed broadband network operators. During this radio show we will look at some of the catalysts for broadband network investments and examine the menu of technology options on offer, including vectoring and G.fast for copper plant evolution and the various deployment possibilities for FTTH/B.