Computerworld - After being outbid twice by rival EMC Corp., NetApp Inc. today announced that it will not increase its $1.9 billion offer to acquire data deduplication vendor Data Domain Inc., saying the two companies have terminated their merger agreement.
NetApp also confirmed that it has received a $57 million break-up fee from Data Domain as a result of the termination of the agreement.
In March, NetApp originally offered $1.5 billion in cash and stock for Data Domain. But early last month, EMC -- with its deeper pockets -- came in with an all-cash bid of $1.8 billion for the company. NetApp then increased its bid to $1.9 billion. And yesterday, EMC again countered with a $2.1 billion all-cash offer, this time sweetening the bid by removing any deal-protection provisions, including a deal termination fee.
"While NetApp's acquisition of Data Domain would have produced benefits for customers and employees and complemented NetApp's existing growth trajectory, we remain highly confident in our already compelling strategic plan, market opportunities and competitive strengths," said NetApp CEO Dan Warmenhoven.
Warmenhoven said his company applies a disciplined approach to acquisitions based on producing long-term value for the company's stockholders, and so it was not able to justify "engaging in an increasingly expensive and dilutive bidding war that would diminish the deal's strategic and financial benefits."
"We look forward to continuing to build on our foundation of innovation and customer service, and to continuing to execute our successful growth strategy," he said.
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