Seagate buys into SAN vendor
By Sonia R. Lelii, PC Week Online
December 15, 1999 2:04 PM ET
Seagate Technology Inc. has taken on a new subsidiary in a deal valued at $360 million.
In an announcement yesterday, the disk drive manufacturer purchased Xiotech Corp., of Eden Prairie, Minn., because it was specifically interested in the smaller company's REDI software architecture.
REDI, which stands for Real Time Data Intelligence, is a data storage software suite that reduces backup time, reconfigures storage devices without downtime and clusters disk drives for better performance. REDI software, which runs on Windows NT, provides virtualization capabilities enabling IT managers to logically partition the space on disk drives.
"The technology from Xiotech looked very interest-ing to us," said Phil Montero, Seagate's senior manager of corporate communications. "A lot of the software is the core value of their products. It does something that no one else does."
For Xiotech, the deal means the young company gets the benefits of Seagate's experience with OEM agreements.
"Seagate is better known in the industry, and Xiotech is not. When it comes to OEMs, Seagate is much better at it than we are," said Richard Blaschke, Xiotech's executive vice president of marketing. "We definitely will work together in that arena."
Xiotech, which has 100 employees, including nearly 35 engineers, also produces a disk array called REDI Storage Manager. The device supports more than 3 terabytes of centralized storage information.
The REDI software suite has six components, enabling IT managers to combine the capacity of up to 64 drives into one storage pool. As many as 256 virtual drives can be created and assigned for up to 192 servers.
Xiotech, a privately held company founded in 1995, will merge with Seagate, of Scotts Valley, Calif., for about $360 million in Seagate common stock. Xiotech has been shipping products for the last year and a half. The deal between Seagate and Xiotech will be finalized next quarter.
Seagate can be reached at www.seagate.com. Xiotech can be reached at www.xiotech.com.
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