Adaptec buys Snap Appliance for $100M

Snap Appliance makes network-attached storage servers for file sharing

Adaptec Inc., a maker of network adapter cards, yesterday announced that it will acquire storage server vendor Snap Appliance Inc. for approximately $100 million.

San Jose-based Snap Appliance, which makes network-attached storage servers for file sharing, will become a division of Adaptec but will keep its name, according to Bob Stephens, president and CEO of Adaptec, based in Milpitas, Calif.

Adaptec makes network interface cards and internal controllers for storage arrays. The company said in a statement that the acquisition will expand its external-storage product portfolio and systems channel business.

"Together, Adaptec and Snap Appliance have strong synergies," Stephens said. By teaming up, the companies "...can deliver solutions for businesses of almost any size and requirements, almost any existing infrastructure, anywhere in the network...."

Mark Delsman, vice president of business strategy at Adaptec, said in an interview today that the company has been looking to move into the external-storage systems market for more than a year. In February 2003, for example, it acquired Eurologic Systems, a Dublin-based maker of block-based storage systems for Fibre Channel and iSCSI networks.

"We're really trying to develop this end-to-end storage story," Delsman said.

But Brian Babineau, an analyst at Enterprise Storage Group in Milford, said Adaptec has had difficulty integrating past acquisitions. "The question now is, how does Adaptec integrate Snap and start to generate [additional revenue]," Babineau said.

The company wants to leverage Snap Appliance's existing channel relationships to get into the storage systems business. Snap Appliance has an installed base of about 30 petabytes, Babineau said.

Formerly known as Meridian Data, Snap Appliance was acquired by Quantum Corp. in 1999 but was spun off as a separate company in October 2002. Quantum retained a stake in the company.

With the acquisition, Adaptec will also add Snap Appliance's GuardianOS software platform, which can manage both block and file data.

Snap Appliances sells its products through resellers.

Copyright © 2004 IDG Communications, Inc.

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