Top five acquisition U-turns that burned the channel

Doug Woodburn
clock • 7 min read

SonicWall's CEO this week opened up on the issues its brief ownership by Dell caused partners. But it's not the only example of an acquisition volte-face by a large vendor causing pain for the channel

SonicWall's executives this week opened up about the struggles the firewall vendor and its partners endured during the brief period it was owned by Dell.

Innovation had "stagnated", and by the end of Dell's ownership of the firm partners had lost the ability to make money from selling and servicing its portfolio, they told CRN.

But SonicWall isn't the first and won't be the last specialist brand that is bought - and then promptly sold on - by a vendor giant that has failed to add value, often to the detriment of the channel.

Here we count down the top five.

5) Brocade and Ruckus Wireless

All too often, a specialist brand that has set the market alight is acquired, but is then left to fester rather than flourish under its new owner.

Brocade's brief and confusing tenure in charge of Ruckus not only caused the wireless vendor's market value to plummet, but also sparked disruption and uncertainty for its partners.

Brocade acquired Ruckus for $1.5bn last April but the fast-growing wireless LAN vendor was left in ownership limbo when just seven months later Broadcom announced it was buying Brocade. Broadcom made it clear from the outset that it only wanted Brocade's storage business, and a separate deal for Ruckus and Brocade's wider network edge business was eventually agreed with consumer comms firm Arris in February for a knock-down price of $800m.

The ownership pass-the-parcel evidently took its toll on Ruckus' valuation as a business, and also made partners twitchy.

Murray Pearce, UK managing director of Ruckus distributor Infinigate, told CRN in February that he was "cautiously optimistic" at the identity of Ruckus' new owner, which intends to run Ruckus as a separate unit.

"What people don't like is uncertainty," he said at the time. "Now we can look at the new owner and look at their intentions and plans. The first thing to say is that the business has not gone to a company that is incompatible with our business and the channel. They have reiterated to us the importance of the channel."

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