Raytheon to buy BBN, a firm that helped create Net
Raytheon Co. has struck an agreement to buy BBN Technologies, a privately held Cambridge firm that played a vital role in the creation of the Internet.
Raytheon said the deal should close before the end of the year. The price was not disclosed, and executives of Raytheon, a Waltham-based defense contractor, and BBN declined to comment further.
BBN, founded in 1948 by Massachusetts Institute of Technology professors Richard Bolt and Leo Beranek and MIT graduate Robert Newman, began as an acoustics research business.
Early on, it won a contract to do acoustic-design work in the General Assembly Hall of the United Nations building in New York City. The company, which has about 700 employees in seven US facilities, now mainly does contract research and development work for military and other government agencies.
BBN has continued to specialize in acoustics research. Among its current products is Boomerang, a system used by the US military to pinpoint the locations of enemy snipers by analyzing gunshot sounds.
But the company became famous for its research in computer networking. In the 1960s, it developed the first modem for transmitting digital data over telephone lines and invented a router to accurately relay vast amounts of data to multiple locations.
BBN also played a major role in the invention of electronic mail, including the first use of the “at’’ symbol as a vital part of all e-mail addresses.
BBN was also chosen by the Department of Defense to build a computer network called Arpanet, the forerunner of the modern Internet.
During the 1990s, BBN ran a commercial Internet service and was acquired by the telephone carrier GTE, which, in turn, merged with Bell Atlantic in 2000 to become Verizon Communications.
Five years ago, BBN managers joined with two venture capital firms, Accel Partners and General Catalyst Partners, to purchase BBN from Verizon and operate it as a privately held company.
David Fialkow, cofounder of General Catalyst Partners, hailed the deal with Raytheon. “We feel incredibly fortunate,’’ Fialkow said. “It was an excellent result for BBN employees and investors.’’
Hiawatha Bray can be reached at bray@globe.com. 
