New Zealand-based network monitoring provider Endace has acquired Applied Watch Technologies, a managed security services provider, for $5 million (£2.4 million).

Endace had provided Applied Watch with $500,000 (£246,000) in working capital, and will issue an initial cash consideration of $3.9 million (£1.9 million) upon the deal's completion.

Applied Watch lost $112,000 (£55,000) last year, despite revenues of $1.5 million (£737,000). As of 30 September, Applied Watch, which also provides centralised management tools for open-source products, had net liabilities of $376,000 (£185,000), according to Endace.

Stephen Gleave, VP of marketing at Endace, said that the acquisition will help the company take advantage of an increase in corporate use of open-source products.

“So what we hope to achieve is securing open source, and having a centralised managed place for that software to run,” he said.

Representatives from Applied Watch could not immediately be reached for comment.