BETHESDA, Md., Nov. 2 /PRNewswire-FirstCall/ -- American Capital Strategies Ltd. announced today it has invested $12.5 million in convertible preferred equity issued by Narus Inc. Narus is a provider of the only carrier-class, real-time Internet Protocol (IP) traffic analysis system essential to manage, secure and deliver services over IP. Existing Narus investors J.P. Morgan Partners, NeoCarta Ventures Inc., Walden International and Mayfield Fund also participated in the American Capital-led financing, which totaled $20 million. Greg Smitherman, American Capital Managing Director, will be joining Narus' Board of Directors.
"We are delighted to be investing in Narus, an outstanding provider of software that enables carriers to secure their networks from viruses and other intrusions, comply with government regulations and protect and optimize revenue streams," said American Capital Managing Director Gordon O'Brien. "Our investment supports Narus' growth as it continues to develop products for next generation networks adequate to meet future demand for IP services. This is our Technology Group's third investment and it is a significant addition to our growing portfolio of business to business software companies."
"Narus' key product, NarusInsight(TM), stands out in its market because it integrates capabilities to secure traffic flows, ensure compliance with government requirements and provide revenue generating services. This rich and integrated functionality in a top performing product reduces customer capital expenses and operating costs," said American Capital Managing Director Virginia M. Turezyn. "In addition, Narus' software product is highly scalable, making it the solution of choice to meet the ever growing network throughput demands of IP Multimedia Services. Narus' difficult to replicate product and the Company's deep carrier penetration provide a compelling competitive edge."
"Narus' products are highly regarded by the leading network integration firms. The Company has established strong relationships with many of them, including IBM, VeriSign, NEC and Datacraft," said American Capital Managing Director Greg Smitherman. "Narus' CEO Greg Oslan has broad industry experience and has demonstrated excellent leadership and vision, having quickly targeted the larger and faster growing market opportunities in security, traffic classification and government compliance. Narus anticipates continued robust growth supported in part by deepening its relationships with major channel partners and through ongoing development of innovative products and technology."
Narus, founded in 1997, is a leading provider of security, classification and government compliance solutions for carrier-class networks. NarusInsight(TM) provides customers with network protection through detection of anomalous events including worms and viruses; usage and content-based billing for any form of IP data; and analysis of traffic for network planning, marketing or real-time management. NarusInsight(TM) has garnered several awards over the last two years including the Red Herring Top 100, the AlwaysOn AO100 Private Company award, and the 2006 Tomorrow's Technology Today award. The Company's customers include leading landline and wireless carriers such as at&t Inc., KDDI Corporation, Telecom Egypt, Saudi Telecom, Brasil Telecom, US Cellular and T-Mobile. Narus is headquartered in Mountain View, CA and has subsidiaries in India and China. Narus also has sales offices in Washington, DC, China, Japan, Singapore, Hong Kong, Brazil, the United Kingdom and France.
"American Capital's wide industry expertise and access to a broad base of capital provide invaluable support as we seek to expand our relationships with leading network integration firms and bring innovative new technology to market," said Narus CEO Greg Oslan. "We welcome American Capital's investment and look forward to working together."
ABOUT AMERICAN CAPITAL TECHNOLOGY
Launched in February 2006, the American Capital Technology Group invests in early, middle and late stage technology companies as well as mature companies driven in significant part by a specific technology. With the flexibility to invest senior debt, subordinated debt and equity from $5 million to $500 million, the American Capital Technology Group can leverage its capital base and domain expertise to build category-leading companies.
American Capital has approximately $1.7 billion in technology investments in its existing portfolio. These companies generally are mature, high performing, cash flowing companies with excellent growth rates. They operate across many industry sectors and are driven by a broad range of technologies. The Technology Group extends American Capital's existing technology investment business by investing in earlier stage technology companies.
ABOUT AMERICAN CAPITAL
American Capital is a publicly traded buyout and mezzanine fund with $11.5 billion off capital resources under management. American Capital invests in and sponsors management and employee buyouts, invests in private equity buyouts, provides capital directly to early stage and mature private and small public companies and through its asset management business is a manager of debt and equity investments in private companies. American Capital provides senior debt, mezzanine debt and equity to fund growth, acquisitions, recapitalizations and securitizations. American Capital invests from $5 million to $500 million per company.
As of October 31, 2006, American Capital shareholders have enjoyed a total return of 556% since the Company's IPO -- an annualized return of 23%, assuming reinvestment of dividends. American Capital has paid a total of $1.3 billion in dividends and paid $22.44 dividends per share since its August 1997 IPO at $15 per share.
Companies interested in learning more about American Capital's flexible financing should contact Mark Opel, Senior Vice President, Business Development, at (800) 248-9340, or visit http://www.americancapital.com/.
Performance data quoted above represents past performance of American Capital. Past performance does not guarantee future results and the investment return and principal value of an investment in American Capital will likely fluctuate. Consequently, an investor's shares, when sold, may be worth more or less than their original cost. Additionally, American Capital's current performance may be lower or higher than the performance data quoted above.
This press release contains forward-looking statements. The statements regarding expected results of American Capital Strategies are subject to various factors and uncertainties, including the uncertainties associated with the timing of transaction closings, changes in interest rates, availability of transactions, changes in regional, national or international economic conditions, or changes in the conditions of the industries in which American Capital has made investments.
CONTACT: Virginia M. Turezyn, Managing Director, Technology Group, +1-650-289-4560, Greg Smitherman, Managing Director, Technology Group, +1-650-289-4560, or Brian Maney, Director, Corporate Communications, +1-301-951-6122, all of American Capital Strategies Ltd.
Web site: http://www.americancapital.com/
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