Google announced today that it has signed a definitive agreement to acquire Postini, a leader in on-demand communications security and compliance solutions.

Postini's services -- which include message security, archiving, encryption, and policy enforcement -- can be used to protect a company's email, instant messaging, and other web-based communications. Under the terms of the agreement, Google will acquire Postini for $625 million in cash, subject to working capital and other adjustments, and Postini will become a wholly-owned subsidiary of Google. The agreement is subject to customary closing conditions and is expected to close by the end of the third quarter 2007.

Hosted services, like Google Apps and Postini solutions, provide organizations with high quality communications tools without the expense and hassle of traditional on-premise solutions. Google Apps, which includes Gmail, Calendar, Talk, Docs & Spreadsheets, and Personal Start Page, has been adopted by more than 100,000 businesses already. Postini solutions include Email Security, IM Security, Web Security, Message Archiving, Message Encryption, and Policy-enforced TLS.

Google will continue to support Postini customers and invest in Postini products.