Picking the biggest enterprise data storage acquisition of 2009 is a no-brainer. EMC's $US2.1 billion buy of Data Domain held the storage industry's rapt attention for six weeks while EMC outbid NetApp and created waves in the backup market. It also was the only major data storage acquisition completed in 2009.
Besides the Data Domain deal, 2009 storage M&A was more notable for the deals that didn't come off. Host bus adapter (HBA) vendor Emulex Corp. fought off a $US912 million hostile takeover attemptfrom networking chip vendor Broadcom. After losing Data Domain, NetApp was considered a prime candidate to buy or be bought. Neither happened. Seven weeks after Brocade reportedly put itself up for sale, CEO Mike Klayko declared the company was not on the block. By then, its most likely suitor, Hewlett-Packard (HP) bought Ethernet switch vendor 3Com instead of SAN-LAN switch vendor Brocade.
When Dell said it was shopping, a lot of people anticipated it would try to repeat its EqualLogic deal and buy another storage company. It bought EDS instead.
It's been nearly seven months since Oracle agreed to pay $US5.6 billion for Sun Microsystems Inc. That deal has yet to close because of regulatory issues and won't happen for a few more weeks. Frequent storage shoppers IBM and Symantec didn't make any data storage buys in 2009 (but has hinted at new tools to manage unstructured data), and EMC had an unusually quiet M&A year except for Data Doman.
Here's a look at the top enterprise data storage acquisitions of 2009:
1. EMC pays $US2.1 billion for Data Domain. This story began May 20 when NetApp surprisingly said it reached agreement to acquire Data Domain for $US1.5 billion in cash and stock. Eleven days later, EMC made an offer of $US1.8 billion directly to Data Domain's shareholders. NetApp made one counter offer – again accepted by Data Domain's directors – before EMC came up with its winning bid that Data Domain shareholders accepted July 8.
EMC's acquisition has repercussions in the data backup space. EMC dumped its data deduplication OEM partner Quantum, prompting Quantum to seek other partners and alter its disk backup strategy. EMC also has a one-two dedupe punch with Data Domain for backup targets and Avamar software for host-based dedupe.
Losing Data Domain leaves NetApp with the hole in its backup portfolio still unfilled. And the heightened interest in data deduplication puts other companies in play as prime acquisition candidates for 2010 – including CommVault, FalconStor, ExaGrid and Permabit. You can also expect large backup vendors Hewlett-Packard, IBM and Symantec to continue to strengthen their dedupe portfolios.
2. Oracle tries to buy Sun for $US5.6 billion. Although this isn't primarily a storage deal, several of the myriad unanswered questions involve data storage. Does Oracle really want to sell tape libraries and disk arrays? Will it sell off those pieces? What happens to Sun's open storage initiative? And where does this leave the Oracle CEO's pet storage project, Pillar Data Systems? We'll likely learn the answers to those questions eventually, but first Oracle needs permission from the European Commission to make the deal.
3. LSI buys ONStor, acquires NAS. OEM storage-area network (SAN) vendor LSI bought network-attached storage (NAS) vendor ONStor for $US25 million with the intention of developing multiprotocol storage systems that handle file and block data. Although LSI is selling ONStor's clustered NAS gateways, the main purpose of the acquisition was to add NAS capabilities to the SAN storage systems LSI manufacturers for OEM partners, including IBM, Sun, Teradata and other vendors. The LSI-ONStor deal was the second clustered NAS acquisition in July, following HP's purchase of Ibrix.
4. HP buys Ibrix, clusters its clustered NAS. HP, which bought clustered NAS vendor PolyServe in 2007, added to its collection by grabbing Ibrix for an undisclosed price last July. HP launched a NAS platform based on Ibrix software in November, the StorageWorks X9000 Network Storage System, and insists there is still a market for NAS based on PolyServe software.
5. EMC consumes eDiscovery partner Kazeon. EMC's other storage deal of 2009 was a small one – it bought Kazeon for an undisclosed price to try and boost its SourceOne compliance and eDiscovery platform. EMC used a combination of partners Clearwell Systems, Kazeon and StoredIQ Inc. when it launched SourceOne last April, but is now integrating Kazeon more deeply while phasing out the others after the September acquisition.
6. QLogic grabs NetXen. While its HBA rival Emulex was fighting off Broadcom, QLogic Corp. moved to grab 10 Gigabit Ethernet (10 GbE) chip startup NetXen Inc. for $US21 million to bolster its consolidation portfolio in May. QLogic is adding NetXen 10 GigE silicon to its iSCSI, Fibre Channel and Fibre Channel over Ethernet (FCoE) capabilities for its next generation of converged network adapters (CNAs).
7. Rackable buys SGI, then becomes SGI. Rackable Systems acquired Silicon Graphics' assets for $US42.5 million in April, then adopted the better-known SGI moniker. It's still not clear how much of the old SGI's storage IP will end up in the products that the former Rackable brings to market, but it's still selling the SGI InfiniteStorage NAS and RAID platforms.
8. BakBone buys CDP partner Asempra. BakBone Software Inc. acquired Asempra Technologies Inc. for less than $US2 million to retain Asempra's continuous data protection (CDP) technology. Before the acquisition, BakBone already sold Asempra's Business Continuity Server (BCS) branded as BakBone NetVault: Real-Time Data Protector. After the acquisition it brought out software-only versions of the appliance, which restores data on Exchange, SQL Server or Windows file systems after a server problem.