VMware to acquire Airwatch

VMware has announced its inorganic growth plansenter in mobile security space, it acquires Atlanta-based AirWatch, enterprise mobile management and security solutions provider for approximately $1.175B in cash and approximately $365M of installment payments and assumed unvested equity.

VMware said that the acquisition is expected to close during late Q1 2014 subject to regulatory approvals and customary closing conditions. "The acquisition will be funded through a combination of balance sheet cash and proceeds from approximately $1B of additional debt to be provided by EMC. VMware will also continue with its ongoing share buyback program," said VMware.

The AirWatch team will continue to report to founder and chief executive officer John Marshall as part of VMware's End-User Computing group, led by Sanjay Poonen, EVP and GM. Alan Dabbiere, AirWatch's co-founder and chairman, will be overseeing a new AirWatch operating board which will report to Pat Gelsinger, VMware chief executive officer.

"AirWatch provides best-in-class, secure, enterprise-mobile management to thousands of businesses around the world," said Pat Gelsinger, chief executive officer, VMware. "With this acquisition VMware will add a foundational element to our end-user computing portfolio that will enable our customers to turbo-charge their mobile workforce without compromising security," Pat added.

"When we started AirWatch, we set out to help businesses succeed in the mobile explosion that was set to come. Now there are more than 2 billion smart phones and tablets in the world and more than half of those devices touch an enterprise," said Alan Dabbiere, co-founder and chairman, AirWatch. Alan further added, "By joining a proven innovator like VMware, we now have an opportunity to bring our leading-edge solutions to an even broader set of customers and partners to help them optimize for the mobile-cloud world."

AirWatch is one of the leading providers of enterprise solutions for Mobile Device Management, Mobile Application Management and Mobile Content Management. With more than 10,000 customers globally and more than 1,600 employees across nine global offices, AirWatch's solutions give enterprises a strategic platform to securely manage a rapidly growing set of mobile devices and an increasingly mobile workforce. The Atlanta site is expected to expand and be the center of VMware's mobile operations.

"Our vision is to provide a secure virtual workspace that allows end users to work at the speed of life," said Sanjay Poonen, EVP and GM of VMware's End-User Computing group.

This acquisition will expand VMware's End-User Computing group; AirWatch's offerings will form an expanded portfolio of mobile solutions that are complementary to VMware's portfolio. The acquisition has been approved by the boards of directors of both VMware and AirWatch.