IBM announced that it has entered into deal to buy Internet Security Systems for $1.3 billion in cash, which equates to $28 per share of stock.

Founded in 1994 by Christopher Klaus, ISS provides security solutions including protection for network borders, servers, and desktops as well as managed security and consulting services. The company claims to have more than 11,000 customers worldwide, which include 17 of the world’s largest banks, 15 of the largest governments, and 11 of the top public insurance companies. Upon closing of the acquisition ISS will become a security business unit at IBM within the company's Global Services organization.

"Companies recognize that rapidly evolving security threats and complex regulatory requirements have turned security into a mission-critical priority," said Val Rahmani, General Manager of Infrastructure Management Services in IBM's Global Services organization. "ISS is a strategic and valuable addition to IBM’s portfolio of technology and services. This acquisition will help IBM to provide companies with access to trained experts and leading-edge processes and technology to evaluate and protect against threats and enforce security policies."

The acquisition is subject to ISS shareholder approval and regulatory approval. IBM expects to close the deal by the end of the year.