By now you probably saw that Dean Drako and Barracuda have made an offer of $7.50 a share (in cash) for Sourefire. This values Sourcefire at about 200 million dollars and is a 13% premium over the Friday closing price. Of course this is well below Sourcefire's historical highs, but than again who is worth what they were a few months ago.  I have a chart on the left that shows stock prices.

So what is behind this deal? I think it is all about ClamAV and the Trend Micro suit.  As readers of my blog know, Trend Micro sued Barracuda a few months ago for patent violations around the way Barracuda uses ClamAV in its appliances.  I think Dean was looking to Sourcefire as the owners of ClamAV to step up and help in the defense of the suit.  I believe to date, that has not happened and Dean is upset with it.  In fact Dean actually mentions that suit and Sourcefire's lack of response on it as one of the two reasons why Barracuda's acquisition would make sense. For the other reason Dean takes a swipe at the Sourcefire management team, saying "We believe that the recent FIRE stock price reflects the execution challenges faced by the company???s management to date." 

I am not sure where Dean comes up with the 200 million to complete this deal, but assume he has lined up financing.  However, at this price I don't think this is more than a stunt.  If Barracuda goes beyond $7.50 a share to $10.00 a share or so, it gets real interesting.  Maybe this puts Sourcefire in play and someone else comes forward with another offer, who knows.  But right now I think Dean is just looking to stir the pot.

Update: As I expected, this morning Sourcefire rejected the Barracuda offer according to this article in BusinessWeek. The Sourcefire board said the 187.4 million dollar offer "is not in the best interests of Sourcefire and its stockholders".  Lets see what Barracuda does next.