Websense, Inc. (Nasdaq: WBSN) today announced a definitive agreement to acquire PortAuthority Technologies, Inc., of Palo Alto, Calif., and Ra'anana, Israel, for approximately US$90 million in cash.

The planned acquisition will bring together two technology and market leaders in preemptive content security: PortAuthority with its information leak prevention technology and Websense with its ThreatSeeker(TM) malicious content identification and categorization technology. The result will be a new best-of-breed security software company with the capabilities to help organizations prevent the unauthorized use or disclosure of confidential data while simultaneously protecting users and data from external malicious threats.

Through an existing OEM technology alliance established in September of this year, Websense has been working with PortAuthority to enhance the Websense(R) Deep Content Control(TM) technology to deliver comprehensive security solutions that protect users and data from internal and external threats, both known and emerging.

Combining Websense's ThreatSeeker malicious content identification and categorization technology with PortAuthority's PreciseID(TM) data fingerprinting technology into a single integrated offering will allow organizations to manage how confidential data is permitted to leave an organization and under what circumstances. With deep knowledge of Internet destinations, protocols and applications, along with detailed fingerprints of internal data, Websense Deep Content Control technology will help protect information flowing through the network, including outbound, internal and Web-based email; Web postings; instant messaging; file transfers and network printing. Additionally, both technologies will use an integrated policy engine to give organizations the unique ability to manage and protect information by individual user rather than by device or Internet protocol address.

"Today's high impact security threats aren't about a worm overloading your mail system. They are about people stealing your proprietary information," said Gene Hodges, CEO, Websense. "Websense and PortAuthority are solving this problem today by helping companies prevent Web-based information theft and internal information leakage."

"Through this planned acquisition, Websense gains not only PortAuthority technology but the security-savvy engineers that have developed this industry-leading technology," added Hodges. "Websense is committed to maintaining PortAuthority's research and development presence in Israel and retaining the engineering talent responsible for this innovative technology."

The market for data-centric content control is growing. IDC predicts that this market will grow from US$194.0 million in 2007 to US$434.6 million in 2009, representing a nearly 50 percent compound annual growth rate.(a)

"Websense and PortAuthority provide unique solutions to the information protection puzzle -- protecting information from the inside and outside," said Pete Foley, CEO, PortAuthority. "This acquisition is a natural evolution for both companies given the synergies between Websense's security software, research and content classification, and our award-winning information leak prevention software."

Websense plans to deliver its information leak prevention software through worldwide channel partners, including those with an existing relationship with PortAuthority.

The stockholders of PortAuthority have approved the proposed acquisition, to be effected via a merger between a subsidiary of Websense and PortAuthority. The closing of the merger is subject to standard closing conditions and is expected to close in January 2007.

Upon closure of the transaction, Websense will assume the assets and liabilities of PortAuthority, including approximately US$5 million in working capital and US$4 million in indebtedness. The transaction is expected to be dilutive to Websense non-GAAP earnings per share by 10 to 15 cents in 2007 and slightly accretive in 2008. Due to the absence at this time of estimates of the acquisition-related costs and the allocation of the purchase price between goodwill, in-process R&D, other intangibles and equity-based compensation expenses related to SFAS 123R, we are currently unable to provide GAAP estimates for future earnings.

For more information about PortAuthority Technologies, Inc., visit www.portauthoritytech.com/.

Conference Call

Websense is hosting a conference call and simultaneous webcast today at 9:00 a.m. EST (6:00 a.m. PST), to discuss the announcement. To participate in the call, investors should dial +1-888-208-1812 (domestic) or +1-719-457-2654 (international) 10 minutes prior to the scheduled start of the call. The webcast may be accessed via the Internet at www.websense.com/investors. An audio archive of the webcast will be available on the company's Web site through Tuesday, January 30, 2007, and a taped replay of the call will be available for one week at +1-888-203-1112 or +1-719-457-0820, passcode 3161347.

About Websense, Inc.

Websense, Inc. (Nasdaq: WBSN), a global leader in Web security and Web filtering software, is trusted to protect 24 million employees worldwide. Websense proactively discovers and immediately protects customers against Web-based threats such as spyware, phishing attacks, viruses and crimeware with maximum protection and minimal effort. With diverse partnerships and integrations, Websense enhances our customers' network and security environments. For more information, visit www.websense.com.