Google Acquires Postini for $625 Million

Google has agreed to acquire e-mail security firm Postini in a $625 million deal, the two companies said Monday. The agreement would further Google's push into the enterprise market.

Postini has about 35,000 clients and about 10 million users worldwide. Among the services offered to enterprise clients are anti-spam, archiving, encryption and policy enforcement to protect digital communications.

Google has increasingly been moving into this space over the past year or so by offering Web-based productivity applications. Adding Postini's services to the mix would further sweeten the pot for potential clients.

"We realized that we needed a more complete way to address information security and compliance issues in order to better support the enterprise community," Enterprise vice president and general manager Dave Girouard said.

Postini will become a wholly-owned subsidiary of Google, and the deal is expected to close by the end of the current quarter. Postini was founded in 1999 and currently employs about 300 people.

"With this transaction, we're reinforcing our commitment to delivering compelling hosted applications to businesses of all sizes," Google chairman and CEO Eric Schmidt said. "With the addition of Postini, our apps are not just simple and appealing to users -- they can also streamline the complex information security mandates within these organizations."