Imation Acquires MXI Security

Imation Corp. has acquired the assets of MXI Security from Memory Experts International, Inc.

Financial terms of the transaction were not disclosed.

The acquisition includes MXI’s portable security solutions and technologies, including its OEM business and its line of branded Stealth and Access security products designed to secure and protect the systems, applications and data of governments and enterprises worldwide.

Approximately 40 employees of the Montreal-based MXI business are expected to transfer to Imation with the acquisition.

"This acquisition represents another significant step in Imation’s strategy to invest in key technology platforms to address customers’ needs for data storage, protection and connectivity," said Mark Lucas, president and chief executive officer, Imation Corp. "MXI is an innovative leader in high-security and privacy technologies whose solutions will enhance Imation’s ability to meet our global customers’ growing needs in information security, compliance and management. The MXI team also brings strong technology skills in secure hardware and software engineering, enterprise security solutions, government-validated encrypted USB devices and cryptology to Imation’s research, development and engineering organization."

Lawrence Reusing, former chief executive officer, Memory Experts International and MXI Security, who will transfer to Imation and continue to lead the MXI business, stated: "With Imation’s emphasis on growth in data protection and security, it is an exciting time for MXI to join the Company. We have partnered successfully in the past in the development of Imation’s Defender Collection of secure storage products. By combining MXI’s highly specialized security expertise and proven technologies with Imation’s already strong global leadership in data storage, we expect to reach even more markets with our security offerings. We look forward to continuing to provide OEM partners and end user customers with the leading security solutions they have come to trust under the MXI name."

Commenting on the importance of continued strategic OEM relationships, CEO Mark Lucas concluded: "Imation looks forward to building upon the strength of MXI Security OEM relationships, including McAfee. McAfee is a highly strategic OEM partner to MXI Security and Imation intends to continue the strategic sales, marketing and engineering investments in the McAfee relationship to drive new technology solutions."

Imation’s strategic focus on data security solutions addresses the growing market need for businesses, governments and end users to protect their ever-increasing amounts of data against loss, theft or security breaches. According to the Ponemon Institute, the cost of data breaches continues to rise annually, with the average organizational cost of a breach reaching $7.2 million in 20101. By 2014, the market for secure data solutions specifically designed to address secure portable storage, digital identity and secure portable computing – protecting against data loss, theft or breach – is expected to reach over $4.5 billion.

Imation’s acquisition of MXI Security follows the March acquisition of the assets of ENCRYPTX Corporation, in encryption and security solutions for removable storage media and devices. Imation’s secure storage portfolio includes its Imation branded Defender line of secure portable storage for data at rest, as well as the new MXI Stealth and Access and Stealth Zone offerings.

Imation was advised on the transaction by XMS Capital Partners and Faegre & Benson LLP.