Proxim's Farallon buy is a good fit

The networking companies said this week's acquisition will propel Proxim into the Mac market and extend Farallon's distribution channel

Proxim announced Monday that it has acquired Farallon Communications, a longtime networking developer for Macs and Intel-standard PCs. Proxim, which specializes in wireless broadband networking, said it purchased privately held Farallon for 121,654 shares of Proxim's common stock (worth about $10m) as well as $4m in cash.

The merger, under discussion for the past two years, pools the companies' expertise in wireless and wired networking for Macs as well as Windows PCs, they said. No layoffs at either company are expected as a result of this acquisition, and the companies said they expect to maintain both Proxim's and Farallon's product lines.

"Proxim and Farallon have two very synergistic organisations from both a business perspective and a product perspective," said Ken Haase, director of marketing for Farallon, said.

"We've got technologies in markets that Proxim would like to be in, and they've got technologies and markets where Farallon would like to be as well. The combined forces of both companies, I think, are going to be great for Mac and Windows users worldwide."

As for Proxim, the buyout brings a Wintel-only company into a market it has been yearning to enter.

"The Farallon business model brings us a huge array of Mac expertise," said Kurt Bauer, vice president of marketing for Proxim. "The Mac market is a market we've wanted to be in. With Farallon, we join the Mac market and hit the ground running strong."

Haase said that although there will be some changes in the corporate hierarchy of the company, there will be no change in Farallon's overall commitment to continue support for the Macintosh platform.

"This acquisition is positive across the board for Mac users," Haase said. "The Macintosh product line will not be affected by the acquisition. We have no intention of changing any products. Actually, we'll be coming out with a number of new products in the near future."

"Farallon is staying on as a division of Proxim," Bauer said. "Customers will still talk directly to Farallon as they always have, and they will still have customer and sales support separate from Windows sales and support."

Haase said he sees numerous advantages to Macintosh customers in the market for networking solutions. "Proxim has a much bigger retail and sales channel," Hasse said. "This will allow Farallon to leverage their sales channels and bring our products into more places than ever before."

Farallon's product line includes HomeLine, a home-networking system using standard phone outlets and the SkyLine wireless-networking card.

Proxim's wireless product line includes Symphony, a cordless network system, RangeLAN2, a series of wireless add-ons, and Stratum, a series of long-distance wireless Ethernet bridges.

Bauer told MacCentral a number of Proxim products will now be ported to support Mac users. "Our intent is to leverage the Farallon development expertise to make Symphony a cross-platform solution, hopefully by the end of the year."

The Farallon deal is Proxim's third acquisition in the past year. It purchased Micrilor in January 2000 and Wavespan in December 1999.

Farallon was founded in 1986 and later bought by Netopia. Farallon separated from Netopia in 1998.

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