Editor's note: This story has been updated to report the proper cash amount in SafeNet's coffers. The Fool regrets the error.

For a company with less than $300 million in revenues, a legal and consulting bill of $14 million must be aggravating. Since SafeNet (NASDAQ:SFNT) now faces that expense after untangling its options backdating mess, it's not surprising that the network security firm hopes to leave the public markets. Last Monday, it agreed to a $634 million buyout offer, or $28.75 per share, from private equity firm Vector Capital.

It's an unusual deal, since private equity firms avoided the tech sector just a few years back. Tech companies have few hard assets, depend on key employees, and are vulnerable to competitors' disruptive technologies. But some private equity firms have spotted juicy opportunities in tech, with a variety of potential acquisitions that sport long-term contracts, fairly predictable cash flows, and protected technology assets.

SafeNet seems to offer all those advantages. The company develops sophisticated technologies that help customers secure vital networks, and its customers demand durable, high-quality solutions. SafeNet's marquee clients include Adobe (NASDAQ:ADBE), Bank of America (NYSE:BAC), the IRS, and the Department of Defense.

SafeNet's business has held up admirably, despite the strain of its options investigation. The CEO and CFO departed last October, and the company hasn't filed a 10-Q since March 2006.

But while SafeNet has endured options woes, the rival gorillas of network security have bulked up. Recent deals include EMC's $2.1 billion purchase of RSA, and IBM's (NYSE:IBM) $1.3 billion acquisition for Internet Security Systems (ISS). These security deals have commanded premium valuations, with RSA going for seven times revenues and ISS for 3.3 times revenues.

On that basis, Vector Capital's getting a much better deal here. Subtracting its $76 million in cash, SafeNet sports an enterprise value of $558 million, which translates into roughly 1.86 times revenues. In comparison, the typical valuation for an enterprise software company is usually around two times revenues.

Unless SafeNet conceals far more serious problems, this looks like a good deal for Vector Capital. I'd advise SafeNet stockholders not to tender their shares on this one.

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Fool contributor Tom Taulli, author of The Complete M&A Handbook, does not own shares mentioned in this article. He is currently ranked 1,474 out of 23,901 in CAPS.