VRTS must still be dominating its market: Why else would EMC buy Legato?...
HOPKINTON, Mass. & MOUNTAIN VIEW, Calif.--(BUSINESS WIRE)--July 8,
2003--
-- World's Most Comprehensive Portfolio of Information Storage
Solutions Broadened to Improve Customers' Ability to Access,
Manage And Protect Information From Inception To Archive To
Disposal
EMC Corporation and LEGATO Systems, Inc., today announced a
definitive agreement for EMC to acquire LEGATO, in a stock transaction
valued at approximately $1.3 billion, extending EMC's technology and
market leadership in storage software. The addition of LEGATO's
strengths in heterogeneous information protection and recovery, HSM
(hierarchical storage management), automated availability, and email
and content management will expand EMC's market-leading portfolio of
open storage software, making it easier for customers to access,
manage and protect all of their information. This move underscores
EMC's commitment to open, heterogeneous storage management, expands
EMC's capabilities around information access and recovery, and deepens
EMC's unparalleled storage management expertise and customer service
and support.
Joe Tucci, EMC's President and CEO, said, "This combination is all
about improving the access, management and protection of an
organization's core asset - information - through its complete
lifecycle. We're combining best-of-breed storage technology, two
winning employee populations with similar reputations for customer
focus, and two experienced management teams with highly complementary
visions for the future of information management. This represents a
significant win for both companies' customers, employees, partners and
stockholders, accelerating the evolution of EMC as the company that
offers the most comprehensive, open and integrated information storage
solutions."
The acquisition will accelerate EMC's ability to deliver the
industry's most complete information lifecycle management solutions,
helping customers get the maximum value from their information at the
lowest total cost at every point in the information lifecycle.
Further, LEGATO'S software-focused sales expertise, extensive channel
partner relationships, and strong service capabilities will complement
EMC's distribution strategy and enhance its ability to serve customers
of all sizes around the globe.
David B. Wright, LEGATO's Chairman and CEO said, "LEGATO's current
shareholders, employees, customers, and partners will see tremendous
benefits from EMC's extensive R&D resources, expertise in networked
storage, global distribution and customer reach, and overall financial
strength. We will now have additional resources to further accelerate
the development and delivery of solutions to the market in order to
fulfill our mission of delivering the software and services that
protect and manage customer's information, assure the availability of
their applications and provide immediate access to business-critical
information. This begins the next chapter for LEGATO as we expand our
capabilities and continue our legacy of innovation."
Under terms of the agreement, LEGATO stockholders will receive 0.9
of a share of EMC common stock for each share of LEGATO common stock.
Based upon the EMC closing stock price of $11.74 on July 7, 2003, the
transaction is valued at approximately $1.3 billion. The acquisition
is subject to customary closing conditions, including LEGATO's
stockholder and regulatory approvals, and is expected to be completed
in the fourth quarter of calendar year 2003. When completed, EMC
expects to take an expense charge in the quarter the transaction is
closed for the value of LEGATO's in-process research and development
costs. EMC expects to report a net profit in each quarter in 2003 and
expects the transaction to be slightly accretive to fully diluted
earnings per share in 2004.
Upon completion of the acquisition, EMC intends to operate LEGATO
as a software division of EMC headquartered in Mountain View,
California, led by David B. Wright, LEGATO's current Chairman and CEO.
LEGATO's sales, marketing and service will remain focused on selling
and servicing LEGATO's full line of products and solutions. EMC and
LEGATO will integrate engineering and development functions to
accelerate the development and delivery of comprehensive storage
management solutions for high growth markets such as email management
and HSM/archiving.
EMC President and CEO, Joe Tucci, LEGATO Systems, Chairman and
CEO, David B. Wright and EMC Executive Vice President and Chief
Financial Officer, Bill Teuber, will discuss the acquisition on a
conference call for financial analysts, investors and the media at
8:30 a.m. EDT, today. The dial-in numbers are (888) 790-1750
(domestic) or (210) 234-8670 (international). The pass code to access
the call is EMC. For the general public, the call will be webcast with
supporting slides at EMC and LEGATO's homepages,
www.emc.com
and
www.legato.com
. A replay of the call will be available approximately
one hour following the call at (402) 530-7619. |
