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NetApp to Purchase Engenio External Storage Systems Business of LSI Corporation
March 2011 by Emmanuelle Lamandé
NetApp announced that it has entered into a definitive agreement to purchase the Engenio® external storage systems business of LSI Corporation, a publicly held company headquartered in Milpitas, California, in an all-cash transaction for $480 million. The close is anticipated to occur in approximately 60 days subject to customary closing conditions. The transaction is expected to be accretive to NetApp’s GAAP and non-GAAP earnings per share by the end of the second quarter of its 2012 fiscal year.
Engenio will enable NetApp to address emerging and fast-growing market segments such as video, including full-motion video capture and digital video surveillance, as well as high performance computing applications, such as genomics sequencing and scientific research. NetApp has the channel reach and customer relationships today that require high performance and big bandwidth capabilities that will be well served by Engenio’s storage platform. These segments are expected to collectively represent a $5 billion incremental market opportunity by 2014. The Engenio acquisition will also enable NetApp to expand its market reach with a mature OEM business that will further diversify its channels to market, especially in markets it currently doesn’t address, such as server-attached and embedded storage.
