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History 2004: After Buying JNI, AMCC to Acquire 3ware

For around $150 million

Applied Micro Circuits Corp. or AMCC is currently investing substantially in storage.

Last year, it helped itself, for approximately $190 million, to JNI, involved in FC HBAs.

This time, it will acquire another U.S. start-up, 3ware, for around $150 million in cash and options to buy stock.

The Sunnyvale, CA-based company was created in 1997 and has raised a total of $86 million in funding. It first took on iSCSI, before entirely changing its business activity, in order to offer a truly innovative patented technology called StorSwitch. The product consists of a SATA switched disk array controller. It’s the only company, to our knowledge, that offers RAID switches with Vixel, acquired towards the end of 2003 by Emulex, which in turn had designed them for the FC interface.

3ware had sales of $17.5 million in 2003 and currently employs 70 people, including the team, which boasts chairman and CEO Faye Pairman, who will report to AMCC’ SVP and SAN GM Brent Little.

With these acquisitions, AMCC, which still has some $700 million in cash after the 3Ware acquisition, is seeking to diversity its holdings with respect to its core business, fiber-optic silicon for WAN, which has suffered from over-capacity, leading to depressed sales, down from $436 million in 2001 to $102 million in 2003.

This article is an abstract of news published on issue 194 on March 2004 from the former paper version of Computer Data Storage Newsletter.