Sun in $50m NAS deal
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Server giant to boost its network attached storage products.
11 May 2005 Sun Microsystems is to acquire the intellectual property rights of network attached storage (NAS) manufacturer Procom Technology, in a $50 million cash acquisition to help boost its struggling storage business unit.
Sun already has a licensing agreement for Procom's storage management software which ships with its StorEdge 5000 network attached storage (NAS) line. And the deal represents a $15 million premium on Procom's total market capitalisation.
In a statement Sun executives said the deal will enable it to build NAS and file-based storage systems faster and cheaper. "Sun is uniquely positioned to leverage Procom's technology to drive down the cost of NAS appliances for customers, while aiming to drive margin opportunities for Sun," said Jonathon Schwartz, president and CEO of Sun.
Under the deal, Procom is expected to transfer its operating system, patents and some engineers to Sun.
To date Sun's storage unit has failed to capture market share from rivals IBM who resells Network Appliances NAS products, storage vendor EMC and Hewlett Packard despite strong attempts to do so.
In 2002 Sun acquired Pirus Networks, a start-up storage and virtualisation company and in 2001 it signed a deal with Hitachi Data Systems to resell its storage systems, but neither deal has boosted Sun's fortunes in storage.
Meanwhile, Sun also said that it had reached agreement to purchase Tarantella, of Santa Cruz, California, maker of network access and management software for $25 million. The deal is expected to close in early 2006.
