NetApp Pays $480 Million for LSI's Engenio Storage

Vendor says purchase gains it access to full motion video capture, digital video surveillance, genomics sequencing and scientific research segments.

NetApp Inc. said this week that it will pay some $480 million for LSI Corp.’s Engenio external storage systems business in an all cash transaction that gains the vendor access to markets for high performance, big bandwidth applications, and offers new opportunities for its channel partners.

NetApp said that the acquisition, which is slated to close in the next two months, will add to its earnings by the end of the second quarter in fiscal 2012.

The deal is the second substantial transaction among data storage players this week, coming only two days after Western Digital disclosed it will buy Hitachi Global Storage Technologies for $4.3 billion.

“Our customers and partners have helped us emerge as an innovation leader and one of the fastest growing storage vendors in shared, virtualized IT infrastructures,” said Tom Georgens, NetApp president and chief executive.

“We believe that the synergies between NetApp and Engenio will create a compelling combination that will help us continue to scale our business and fuel our continued growth,” he said.

NetApp said that the deal for Engenio will help it to meet the needs of existing customers and land new ones whose requirements center around high performance and big bandwidth such as full motion video capture, digital video surveillance, genomics sequencing and scientific research.

NetApp said that it will fold the Engenio business into its existing operation with product development headed by Manish Goel, NetApp executive vice president, product operations. The companies will combine sales teams to maximize Engenio opportunities, officials said.

“With its singular focus on storage, NetApp is well positioned to enhance the value of the Engenio business and enable new growth opportunities,” said Abhi Talwalkar, LSI president and chief executive.

“NetApp’s channel-friendly approach is highly synergistic with the Engenio model of enabling partner and customer success, and the combination should further advance the Engenio storage platform, as well as augment the OEM channels that have been the foundation of its longstanding success,” he said.

TAGS: acquisition,NetApp,LSI,Engenio,Storage



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