SUNNYVALE, Calif. -- Blue Coat(TM) Systems, Inc. (Nasdaq: BCSI), a leading provider of proxy appliances, today announced it has signed a definitive agreement to acquire Cerberian®, a provider of URL filtering software, for approximately $17.5 million in stock. The number of shares issued will be based on the average closing price of Blue Coat stock over the 20 trading day period ending on and including the trading day that is three trading days prior to the closing date, subject to adjustment under certain circumstances. The closing of the acquisition is subject to customary conditions, and is expected to occur in approximately 60 days.

The acquisition will result in the integration of Cerberian's URL filtering and categorization technology onto the Blue Coat ProxySG(TM) appliance. The combination of URL filtering with Blue Coat's content filtering and protocol control capabilities will provide customers with comprehensive Web control. The Cerberian technology will complement Blue Coat's existing "on-proxy" support for URL filtering databases from Secure Computing, SurfControl and Websense, giving customers continued flexibility to choose among each of the well-known databases.

"Customers today experience enhanced Web control, authentication and performance benefits by integrating URL filtering onto our ProxySG appliances," said Brian NeSmith, president and CEO of Blue Coat. "Integrating the Cerberian database with our proxy appliance is a strategic component that will strengthen Blue Coat's competitive position in the industry, and allow us to grow the sales of our proxy appliances more rapidly."

Blue Coat Systems Inc.