EMC Tops NetApp Bid for Data Domain
June 1st, 2009 By: Rich Miller
A bidding war has erupted in the storage sector, as EMC Corporation (EMC) today offered to acquire deduplication specialist Data Domain (DDUP) for $30 a share in cash, topping last week’s $25 a share takeover offer from NetApp (NTAP). EMC’s all-cash offer values the deal at $1.8 billion, a 20 percent premium to the cash and stock offer made by NetApp.
“EMC’s all-cash proposal is superior to the proposed NetApp transaction providing Data Domain stockholders greater value and certainty,” the company said in a statement. “EMC’s proposal is not subject to a financing or due diligence contingency, and the company will use existing cash balances to finance the transaction. EMC is promptly commencing a tender offer for all outstanding Data Domain common stock in order to expedite the timing of this transaction.”
“Strategically, this combination will further enhance our ability to broaden EMC’s best-in-class storage portfolio for the benefit of EMC and Data Domain customers and this, in turn, will accelerate EMC’s top-and bottom-line growth rates,” said Joe Tucci, EMC Chairman, President and CEO. “Our substantially superior proposal is a win-win for both companies.”
The deal highlights the growing importance of deduplication, which saves space on storage devices by eliminating duplicate copies of the same file or data. Data Domain has emerged as a leading player in deduplication and the shift from tape storage to disk-based backup. Data Domain systems identify redundant files and data as they are being stored, creating a storage footprint that can be 10 to 30 times smaller than the original dataset.