Sourcefire acquisition scuttled

The Israeli company CheckPoint and the small Maryland company Sourcefire called off a proposed acquisition under intense scrutiny from government investigators, the Washington Post reports.The deal was widely criticized, in light of the huge concern over a Dubai company's proposed acquisition of American ports, by the defense community because Sourcefire's open source Snort software is widely used on government computers.

The companies would not comment publicly on the specifics of the investigation but said they were ending the transaction because of the complexity of the CFIUS [Committee on Foreign Investment in the United States] process.

"We've gone through the whole process hoping it would be approved, but at this point, we're happy to bring the issue to closure," said Michelle Perry, Sourcefire's chief marketing officer. She added that the companies withdrew their request for approval after "carefully considering the complications of the CFIUS process, the lengthy ongoing delays and the current climate for international acquisitions."

Things were not sounding too good for the deal, a Treasury spokeman admitted.

Tony Fratto ... said last night that he could not speculate on whether the deal would have been approved before the official deadline for a CFIUS decision. Three weeks ago, Fratto said that "certain members of the committee have outstanding concerns that there's potential risks to national security were the transaction to proceed."