Seagate buys EVault for US$185 million 21 December, 2006 By Patricia Pickett

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Officials said the transaction is expected to close in the third quarter of Seagate's fiscal year 2007, subject to standard closing conditions and regulatory approvals.

Seagate spokesperson Forrest Monroy said what made EVault an attractive acquisition prospect was its position as a top provider of remote backup services to small and medium businesses, as well as its experienced people and leading technology. "This particular market is currently fragmented," but through the acquisition Seagate anticipates being able to bring scale and leadership through customer loyalty to its brand, as well as its resources and channel expertise, Monroy said.

EVault will operate as a wholly-owned subsidiary, but will be a good fit with Seagate's culture because the focus of both companies is around "achieving leadership through innovation, team work and meeting customer needs better than the competition."

When asked whether there will be any personnel changes as a result of the acquisition, Monroy said: "EVault's employees, management and IP are critical success factors which Seagate plans to retain and grow."

As part of the deal, Seagate will gain immediate market access to remote backup, archival and recovery services, "the largest and most complete offering breadth in the SMB online backup market," said Monroy.

These services are targeted at the underserved SMB market, and will focus on customers with limited IT infrastructure or appropriate resources, said Seagate. In a statement, Seagate officials cited analyst reports pointing to more than 74 million SMBs worldwide, many of whom list data availability and recovery as one of their top IT challenges.

The acquisition is also a significant step forward in Seagate's services strategy, said Monroy. The move "meaningfully strengthens the companys current solutions offerings and broadens the types of services Seagate can offer to businesses and consumers," he said, adding that the vendor sees services as an exciting growth opportunity.

EVault is Seagate's most recent acquisition in the broader storage solutions area and the third for Seagate in the area of services. In 2005, Seagate purchased Mirra, Inc., a provider of networked digital content protection products for the home and small business markets, as well as Action Front, a professional in-lab data recovery company.

As for future acquisitions, Seagate continues to be interested in pursuing underserved markets, but will be "judicious in the selection of newer markets and technologies it will invest in and serve," Monroy said.