US Security Feared Compromised By Israeli Takeover of Sourcefire Software

TEL AVIV (BBC News) March 23 — An Israeli internet firm has abandoned its bid to acquire a smaller American rival after the US government raised security concerns.

Israel’s Check Point Software Technologies ditched plans to buy Sourcefire after a US national security investigation. US officials told Check Point that the transaction could threaten some of the government’s most sensitive IT systems. The deal was called off when the two parties failed to reach an agreement.

Snort software is used to safeguard classified U.S. military and intelligence data.

The Committee on Foreign Investment in the United States (CFIUS), which is responsible for examining acquisitions of US companies by foreign companies, has conducted only 25 full investigations out of a total of 1,600 business transactions that came before it.

The committee recently looked into a controversial takeover plan by an Arab company, Dubai Ports World, involving six key US ports. The Dubai Ports deal was given the go-ahead by the committee but has since been abandoned.

If the Check Point sale, made public early last October, had taken place, it would have acquired all Sourcefire’s patents, source codes and blueprints for its software, as well as employees’ expertise.

The FBI and the Pentagon had particular concerns regarding a particular type of so-called Snort software, which protects certain classified US military and intelligence computers.

● Foreign Investment in the United States:
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Check Point Software Technologies Inc. believes its $225 million acquisition of Sourcefire Inc. and its Snort IDS heralds a new direction for the security giant and a bright future for the open source packet-sniffer. Skeptics and loyalists, though, fear what they believe may be the inevitable demise of one of the industry’s most popular security tools.

The Redwood City, Calif.-based security giant last week announced it would acquire Columbia, Md.-based Sourcefire, the company founded in 2001 by Martin Roesch to foster the development of free and commercial network security products.

Foremost among those products is Snort, the real-time, open source packet-sniffing tool Roesch unveiled in 1998 to inspect network data packets for dangerous payloads or suspicious anomalies. Snort has been downloaded millions of times, and its user community remains passionately devoted to the proliferation and advancement of the product.