Irish internet security specialist Baltimore Technologies yesterday drew a line under one of the most disastrous acquisitions of the dot.com era by disposing of an email company it bought just two years ago at a loss of £680m.

Content Technologies, maker of the MIMEsweeper virus protector and purchased for £700m, was sold to privately owned Clearswift Corporation for £20.5m to give Baltimore enough cash to survive for another year. "This transaction represents good value," chief executive Bijan Khezri said. But the sum was at the bottom end of analysts' expectations and contained a cash payment of just £12m. The balance will be paid in shares in Clearswift. Shares in Baltimore edged up 0.25p to 14.25p.

Since being appointed in the autumn, Mr Khezri has cut the amount of cash draining out of the business each quarter from £30m to £21m, and he hopes the trend will continue. "It would be absolutely wrong to draw the conclusion that Baltimore is out of the woods yet," he warned.

The volatile market conditions that have battered Baltimore to the brink of submission are likely to continue for the foreseeable future.

However, the commitment to investing in new product development remains, and means that Baltimore will now miss its self-imposed target of making a profit by the end of the second quarter by another nine months.

Content Technologies was bought by Baltimore when the Dublin-based firm was riding high in the FTSE 100 index.

The bursting of the dot.com bubble and the tech sector downturn has seen the company sack hundreds of staff and lose two chief executives. Analysts say the company was overconfident and expanded too fast.