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All M&As in 2018

Only 36, lower figure in history of WW storage industry

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 76
2014 72
2015 51
2016 54
2017 52
2018
36
TOTAL 1,325
Acquisitions/year 63

(Source: StorageNewsletter.com)

We count only 36 M&As in 2018. In 2006, there was a record of 104. Since 2013, this number decreased yearly with small growth in 2016 to reach 52 in 2017 compared to 54 the former year, and 63 being the average since 1998. Formerly the  lowest figure was 45 in 2002.

Why this enormous decrease? The consolidation in the mature industry is slowing. Furthermore, there are few start-ups with revolutionary technologies that could interested potential buyers. Some interesting start-ups could be acquired but they apparently are asking for price too high and prefer to remain private or waiting for an IPO.

And into these 36 M&As in 2018 are included three by only Nutanix (Minjar, Netsil and Frame). The price of only 8 deals were revealed by the buyers, meaning that it was relatively low for the 28 other ones with an amount not impacting seriously their financial results.

ALL M&As IN 2018 WITH KNOWN PRICE

Buyer Bought Price in $ million
Broadcom CA Technologies 18,900
Micron IM Flash Technologies, (JV with Intel) 1,500
Carbonite Mozy 145.8
SMART Global Holdings Penguin Computing 85
DataDirect Networks Tintri 60
Silicon Valley Technology Partners Overland Storage 45
Silicon Valley Technology Partners Sphere 3D 45
Veeam Software N2W Software 42.5

(Source: StorageNewsletter.com)

Only two deals surpasse $1 billion in 2018 compared to a total of 4 last year and 3 in 2016. 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 were not in storage only. But there was also the fourth largest deal historically: $18.9 billion by Broadcom to get CA Technologies. The former year, $18 billion was spent by Bain Capital and a lot  of partners to get Toshiba NAND chip manufacturing business.

Another relatively big deal in 2018 was Micron getting IM Flash Technologies for $1.5 billion.

MORE THAN $1 BILLION M&As IN HISTORY OF STORAGE INDUSTRY
(one in 2018)

2015: EMC by Dell, $63,000 million
2001: Compaq by HP, $25,000 million
2018: CA Technologies by Broadcom, $18,900 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 million
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 million
(Source: StorageNewsletter.com)

In conclusion, there was not at all an intense activity in 2018 in number of deals with only one represented huge sum.

For the 8 operations with price being known in 2018, total is $21 billion – compared to $29 billion in 2017- and average per deal is  $2,598 million. It was about the same in 2017:  $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 $635 million for a cumulative total of more than $344 billion spent following 541 deals when price has been revealed and 1,373 all included from 1984.

EMC was historically the most voracious in the storage industry with 79 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 three years. On its side acquirer Dell got a total of 18 companies and also no one since three years.

With these 79 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 27, Veritas added to Symantec 26, IBM 21, WD 21, HP with HPE 20, NetApp 20, Dell 18, and Xyratex (acquired by Seagate) 16 .

The consolidation in the industry will continue in 2019, 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 expansion.

WHO BOUGHT WHOM IN 2018

Month Buyer Acquisition Price * Activity of acquired company
8 Acronis T-Soft NA R&D operations in Bulgaria
12 Agility Recovery Rentsys Recovery Services NA Acquisition of Rentsys Workspace Recovery Business Unit in BC services
5 Betsol Zmanda Enterprise Backup (Carbonite) NA Enterprise backup and DR solution
9 Broadcom CA Technologies 18900 Management software  
2 Carbonite Mozy 145.8 Online backup  
10 Cloudera Hortonworks NA Merger (60% Cloudera, 40% Hortonworks) in enterprise, data management platforms, services and solutions that deliver actionable intelligence
3 Cloudian Infinity Storage NA Software-defined file storage solutions
7 CRU IoSafe NA Disaster-tolerant storage and BC solutions
6 DataDirect Networks Intel Lustre File System NA Analytics and hybrid cloud through intelligent data management for HPC
8 DataDirect Networks Tintri 60 AFAs    
6 Druva CloudRanger NA Backup and DR solutions for AWS
7 Global Distribution Symply NA 4K and 8K ready collaborative storage solutions
11 Hewlett Packard Enterprise BlueData NA Software that transforms how enterprises deploy AI and big data analytics
10 Hitachi Vantara Rean Cloud NA Cloud systems integrator and MSP
4 Kaseya Unitrends NA Enterprise backup and continuity solutions
10 Kaseya Spanning Cloud Apps NA SaaS data protection  
10 Micron IM Flash Technologies (JV with Intel) 1500 Acquiring remaining interest in IM Flash Technologies
9 NetApp StackPointCloud NA Multi-cloud Kubernetes control plane with cloud volumes to accelerate DevOps capabilities
3 Nutanix Minjar NA Unified cost control and enhanced visibility into workloads running in public clouds
3 Nutanix Netsil NA Application discovery and operations management
8 Nutanix Frame NA Cloud-based Windows desktop and application delivery
1 Oodrive Orphea NA Digital asset management
2 Premier BPO dinCloud NA Cloud platform for hosted workspaces and cloud infrastructure
8 Pure Storage StorReduce NA De-dupe software  
11 Red Hat NooBaa NA Frictionless storage software for unstructured data
2 Rubrik Datos IO NA Backup and recovery for NoSQL databases and big data file systems
2 Silicon Valley Technology Partners Sphere 3D 45 Data protection/archive business (assets) comprising Overland and Tandberg
2 Silicon Valley Technology Partners Overland Storage 45 Data management and data protection solutions; SVTP controlled by Eric Kelly
6 SMART Global Holdings Penguin Computing 85 Specialty compute and storage solutions targeting applications in AI, machine learning and HPC
8 StorCentric Drobo NA Storage solutions for consumers, professionals and businesses
8 StorCentric Nexsan NA Enterprise unified storage solutions
1 Synopsys Kilopass NA One-time programmable non-volatile memory IP
1 Veeam Software N2W Software 42.5 IaaS data protection providing cloud-native backup solution AWS workloads
6 Veeam Software nworks NA Enterprise management connectors bridging the gap between VMware virtual infrastructure and enterprise systems management tools from HP and Microsoft
3 Veritas Technologies fluidOps NA Orchestrate, integrate, manage and optimize structured and unstructured data sources housed in silos across on-premises, private, public and hybrid cloud environments
10 Violin Systems X-IO Technologies NA AFAs; acquisition of X-IO Storage, division of X-IO Technologies

 

* In $ million
 (Source: StorageNewsletter.com)

Read also:
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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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