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All M&As in 2017

About 50, as last 3 years, with one at $18 billion
By Jean Jacques Maleval on 2018.01.08

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Since 1998 we analyze the merger and acquisition trends in the worldwide storage industry, which has allowed us the proper perspective from which to gauge the evolution over time.

NUMBER OF ACQUISITIONS SINCE 1998
IN WW STORAGE INDUSTRY

Year
1998 48
1999 59
2000 61
2001 64
2002 45
2003 54
2004 51
2005 75
2006 104
2007 90
2008 74
2009 50
2010 71
2011 62
2012 76
2013 75
2014 72
2015 51
2016 53
2017 52
TOTAL 1,287
Acquisitions/year 68

 

 

 

 

 

 

 

 

 

 

 

(Source: StorageNewsletter.com)

In 2006, there was a record of 104 M&As. Since 2012, this number decreased yearly with small growth in 2016 to reach 52 in 2017 compared to 53 the former year, and 68 being the average since 1998. The  lowest figure was 45 in 2002. So now it is stabilized at around 50 per year since 3 years.

And into these 52 M&As in 2017 are included three (eleven last year) by only J2 Global getting small online backup companies and also surprising by NetApp with the reputation of not being voracious. The price of only 11 deals were revealed by the buyers, meaning that it was relatively low for the 41 other ones with an amount not impacting seriously their financial results.

ALL M&As IN 2017 WITH KNOWN PRICE

Buyer Bought Price in $ million
Bain Capital and others Toshiba Memory Corp. (Toshiba's assets) 18,000
Marvell Cavium 6,000
Thoma Bravo Barracuda Networks 1,600
HPE Nimble Storage 1,090
Veeco Ultratech 815
HPE SimpliVity 650
Cisco Springpath 320
Carbonite Double-Take Software (Vision Solutions) 65
Extreme Networks Broadcom (assets) 55
Vecima Networks Concurrent Computer (assets) 29
Proact IT Teamix 9.5

(Source: StorageNewsletter.com)

What's relatively impressive in 2017 is the number of deals surpassing $1 billion, a total of 4 vs. 3 last year. The highest acquisition in the history of the storage industry, at $63 billion, was the merger in 2015 of EMC by Dell  - even if both of them are not in storage only. But there was also an enormous deal last year (it will be completed in 2018): $18 billion by Bain Capital and a lot  of partners to get Toshiba NAND chip manufacturing business. Another big one is Marvell getting Cavium for $6 billion. Two other acquisitions surpassing $1 billion: Barracuda Networks by Thoma Bravo and Nimble Storage by HPE (also acquiring SimpliVity for $650 million). There was only 2 deals in 2016 over $1 billion, highest one being Brocade by Broadcom for $5.9 billion.

MORE THAN $1 BILLION M&As IN HISTORY OF STORAGE INDUSTRY
(four in 2017)

2015: EMC by Dell, $63,000 million
2001: Compaq by HP, $25,000 million
2017: Toshiba NAND business by Bain Capital (and partners), $18,000 million
2015: SanDisk by Western Digital, $16,000 million
2005: Veritas by Symantec, $11,000 million
2011: Autonomy by HP, $10,300 million
1998: Digital Equipment by Compaq, $9,600 million
2015: Veritas (Symantec) by The Carlyle Group and GIC, $7,400 million
2009: Sun by Oracle, $7,400 million
2013: LSI by Avago Technologies, $6.600 million
2017: Cavium by Marvell, $6,000 million
2016: Brocade by Broadcom, $5,900 million
2011: Hitachi GST by WD, $4,800 million
2005: StorageTek by Sun, $4,100 million
2000: Sterling Software by CA, $4,000 million
2000: Seagate by Suez Acquisition, $4,000 million
2006: Agere by LSI, $4,000 million
2014: Riverbed by Thoma Bravo, $3,500 million
2008: Foundry Networks by Brocade, $2,600 million
2012: Elpida by Micron Technology, $2,500 million
2012: Quest Software by Dell, $2,400 million
2010: 3par by HP, $2,350 million
2015: PMC-Sierra by Microsemi, $2,300 million
2010: Isilon by EMC, $2,250 million
2009: Data Domain by EMC, $2,200 million
2006: RSA by EMC, $2,100 million
2002: IBM HDD by Hitachi, $2,050 million
2000: Cobalt Networks by Sun, $2,000 million
2004: Kroll by Marsh & McLennan Companies, $1,900 million
2006: Maxtor by Seagate, $1,900 million
2000: Ancor Communications by QLogic, $1,700 million
2003: Documentum by EMC, $1,700
2016: Dell EMC Enterprise Content Division by OpenText, $1,620
1998: Seagate Software by Veritas, $1,600 million
2017: Barracuda Networks by Thoma Bravo, $1,600 million
2006: FileNet by IBM, $1,600 million
2006: msystems by SanDisk, $1,500 million
2007: EqualLogic by Dell, $1,400 million
2011: Samsung HDD by Seagate, $1,375 million
2000: Quantum HDD by Maxtor, $1,300 million
2003: Legato by EMC, $1,300 million
2010: Numonyx by Micron, $1,270 million
1996: Cheyenne by CA, $1,200 million
2010: Division 5 Technology by Max Stiegemeier (GCF), $1,200 million
2015: Virtustream by EMC, $1,200 million
1999: Data General by EMC, $1,100 million
2014: Fusion-io by SanDisk, $1,100 million
2017: Nimble Storage by HPE, $1,090 million
1995: Conner Peripherals by Seagate, $1,040 million
2016: QLogic by Cavium, $1,000
(Source: StorageNewsletter.com)

In conclusion, there was not an intense activity in 2017 in number of deals but some of them represented huge sum. Why so few? Some interesting start-ups could be acquired but they apparently are asking for price too high and prefer to wait for eventually an IPO.

For the 11 operations with price being known in 2017, total is $29 billion and average per deal is $2,603 million, figures much higher than in 2016 ($10.6 billion and $754 million) but far from an historical record of $92.3 billion and $6.156 million respectively in 2016.

Consequently, the average price per M&A since 1998 now reaches $596 million for a cumulative total of more than $300 billion spent following 533 deals when price has been revealed and 1,335 all included from 1984.

EMC was historically the most voracious in the industry with 81 acquisitions since 1994. It acquired a record of 23 companies in 2006 and 2007 only, just one in 2011, three in 2012 and 2013, five in 2014, three in 2015 but no one since last two years. On its side acquirer Dell got a total of 18 companies and also no one since two years.

With these 81 deals, EMC is largely in front of Seagate (including Seagate Software) with a total of 31 acquisitions, J2 Global 34, Iron Mountain (in data storage only) 29, LSI with Avago and Broadcom 26, Veritas added to Symantec 25, IBM 21, WD 21, Dell 18, Xyratex (acquired by Seagate) 16, HP with HPE 19, and NetApp 19.

TOTAL AMOUNT OF ACQUISITIONS SINCE 1998
(here we include only the acquisitions when price is known)

Year Number of acquisitions Total amount* Average price*
1998 25 13,119 525
1999 22 3,062 139
2000 38 14,021 329
2001 27 28,279 1,047
2002 21 3,101 148
2003 30 5,503 183
2004 26 4,781 184
2005 42 18,690 445
2006 53 17,366 328
2007 34 7,123 210
2008 28 5,726 205
2009 19 10,431 549
2010 25 10,582 423
2011 29 20,544 708
2012 16 7,061 441
2013 21 10,470 499
2014 17 6,173 363
2015 15 92,342 6,156
2016 14 10,554 754
2017 11 28,663 2,603
TOTAL 533 317,572 596

* in $ million
(Source: StorageNewsletter.com)

The consolidation in the industry will continue in 2018, but at a slow pace, because some publicly-traded companies are in bad shape and even if many storage start-ups are trying to survive with only two possibilities: to be acquired or die.

Furthermore a trend is not going to stop: storage giants invent about nothing in new killing storage technologies and prefer to get them by acquiring start-ups. It's less expansive than investing in their own R&D.

We will probably continue to see several M&As in the most demanding storage sectors: cloud, software, hyperconverged system and SSD where there are too many companies, but also in the channel for consolidation. The year 2008 already began with the acquisition of start-up Avere Systems by Microsoft.

WHO BOUGHT WHOM IN 2017

Mo. BUYER ACQUISITION PRICE* ACTIVITY OF ACQUIRED COMPANY
1 1847 Partners Cinram (European operations & business) NA Optical disc manufacturing and supply chain solutions
4 AntemetA C-Storage NA Data protection
4 Arcserve FastArchiver NA Email archiving
7 Arcserve Zetta NA Enterprise-cloud disaster recovery
2 Axway Syncplicity NA Secure collaboration and file sharing
12 Bain Capital and others Toshiba Memory Corp. (Toshiba's assets) 18,000 Others are Apple, Dell, Kingston, Seagate, SK Hynix, Hoya, and eventually Network Corporation, Development Bank of Japan; NAND chips
11 Barracuda Networks Sonian NA Cloud archiving, compliance and analytics
8 Bet365 Basho Technologies (IP assets) NA NoSQL database technology
3 Betsol Rebit software from Carbonite NA Backup solutions
2 Carbonite Double-Take Software (Vision Solutions) 65 HA software for SMBs
8 Carbonite Datacastle NA Enterprise mobility endpoint backup, recovery and analytics solutions
8 Cisco Springpath 320 Hyperconvergence software
9 Cloudera Fast Forward Labs NA Machine learning and applied AI
7 Cray Seagate ClusterStor Business NA Storage for HPC
2 Data Blue LPS Integration NA VAR in cloud infrastructure, networking, security and storage architecture
2 Datto Open Mesh NA Cloud-managed WiFi networks and SD-LAN
7 eFolder Axcient NA Merger; cloud-based DR and data protection platform
1 Endless Fund IV MTI Europe NA Integrator in UK, Germany and France
7 Evernex TTS France NA Tape drives and libraries repair
3 Extreme Networks Broadcom (assets) 55 Brocade data center networking business
1 Hewlett Packard Enterprise SimpliVity 650 Software for hyperconverged infrastructure
3 Hewlett-Packard Enterprise Nimble Storage 1,090 Hybrid and all-flash systems
7 Hive-IO Atlantis Computing (assets) NA Software-defined storage and VDI
7 HyTrust DataGravity NA Data-aware storage platform that tracks data access and analyzes data
10 IDdriven Iosafe NA Disaster proof storage
4 Insight Venture Partners Spanning Cloud Apps NA Acquired from Dell EMC; in SaaS data protection
1 j2 Global Abaxio NA Cloud backup in USA
7 j2 Global CloudRecover Cloud NA Backup in Australia
10 j2 Global backupsonline NA Cloud backup in Netherlands
9 Longsys Lexar (brand of Micron) NA Consumer flash storage
11 LTL Group Dataram NA Memory products
11 Marvell Cavium 6,000 Multi-core processing, networking communications, storage connectivity and security solutions
5 NetApp Plexistor NA Software that turns off-the-shelf servers into high-performance converged infrastructure offerings with persistent memory technologies
5 NetApp Immersive Partner Solutions NA Cloud-based converged infrastructure monitoring and compliance
8 NetApp GreenQloud NA Iceland software company in Qstack hybrid cloud management software
1 NXSN Acquisition Nexsan (Imation) NA Disk arrays, NXSN Acquisition is affiliate of Spear Point Capital Management
8 Park Place Technologies Allen Myland NA Pennsylvania-based storage maintenance firm
6 Park Place Technologies Performance Data (Asia assets) NA Hardware maintenance and systems integration services
1 Proact IT Teamix 9.5 Provider of technology and services in Germany
1 Procurri Congruity NA Provider of enterprise storage support for EMC, NetApp, HDS, Brocade and VMware
4 Quantum Partners (Soros) Violin Memory NA All-flash arrays
9 Rackspace Datapipe NA Managed public cloud services
6 Reactive Group Arraid NA Replacement storage solutions for ageing disk, tape and floppy drives and revamping products using SSD
8 Red Hat Permabit (assets) NA De-dupe and compression technology
1 Sphere 3D HVE and sister company Unified ConneXion NA Converged and hyperconverged infrastructure and IT services
1 StorageCraft Exablox NA Flash and HDD based scale-out NAS
11 Thoma Bravo Barracuda Networks 1,600 Cloud-enabled security and data protection solutions
10 Vecima Networks Concurrent Computer (assets) 29 Content delivery and storage
2 Veeco Ultratech 815 Lithography, laser-processing and inspection systems
10 Vista Equity Partners Datto NA BC solutions that secure business data; merged with Autotask
8 Western Digital Upthere NA Home cloud backup
8 Western Digital Tegile Systems NA Multi-protocol SSD/HDD array with de-dupe for primary storage

* In $ million
 (Source: StorageNewsletter.com)

Read also:
All M&As in 2016
Number of deals decreased to 47 compared to 51 in 2015, 65 being average per year since 1998
by Jean Jacques Maleval | 2017.01.04 | News
All M&As in 2015
Only 51 but huge ones (Dell/EMC, WD/SanDisk, Carlyle/Veritas)
by Jean Jacques Maleval | 2016.01.04 | News
All M&As in 2014
Top ones are ...
by Jean Jacques Maleval | 2015.01.05 | News
All M&As (73) in 2013
Same number in 2012: top ones are ...
by Jean Jacques Maleval | 2014.01.03 | News
All M&As (70) in 2012
70 compared to 61 in 2011: top ones are ...
by Jean Jacques Maleval | 2013.01.15 | News
ANALYSIS: All Mergers and Acquisitions in 2011
The year of HDD consolidation
by Jean Jacques Maleval | 2012.01.03 | News
2010: The Year of Consolidation
57 M&As and big ones, vs. 47 in 2009
by Jean Jacques Maleval | 2011.01.01 | News
Only 43 M&As in 2009 in the WW Storage Industry
Vs. 69 in 2008, 84 in 2007 and 104 in 2006
by Jean Jacques Maleval | 2010.01.04 | News | [with our comments]

These figures in these former reports on M&As increased sometimes later as we discovered other acquisitions after these annual publications.

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