EMC enters bidding war with NetApp

Storage rivals go to war over acquisition of de-duplication vendor Data Domain

Tucci: the combination of EMC and Data Domain will result in a business larger than a billion dollars for EMC in 2010

EMC has made a surprise $1.8bn (£1.1bn) all-cash offer for data de-duplication firm Data Domain, entering a bidding war with rival NetApp.

The storage giant’s offer equates to $30 per share in cash.

Last month, data management vendor NetApp announced plans to buy Data Domain for $1.5bn (£950m). EMC’s all-cash offer represents a 20 per cent premium on the cash and stock offer made by NetApp for Data Domain on 20 May.

EMC chief executive Joe Tucci said: “Strategically, this combination will further enhance our ability to broaden EMC’s best-in-class storage portfolio for the benefit of EMC and Data Domain customers and this, in turn, will accelerate EMC’s top- and bottom-line growth rates. Our substantially superior proposal is a win-win for both companies.”

EMC has claimed that the acquisition of Data Domain will strengthen EMC’s position in the storage software arena.

Tucci added: “The combination of EMC and Data Domain technologies will strengthen EMC’s leadership in the fast-growing and very important next-generation disk-based backup and archive market, and will also result in a business larger than a billion dollars for EMC in 2010.

“We expect the transaction with Data Domain to be accretive to EMC’s 2010 non-GAAP diluted earnings per share.”

Founded in 2001, Santa Clara, California-based Data Domain employs 800 people.

If EMC’s bid is accepted, Data Domain will be the largest acquisition in EMC's history. The vendor acquired VMware for $635m in 2003. It is now valued at $12.6bn.