LSI Definitively Acquires ONStor for $25 Million

LSI Corporation has signed a definitive agreement to acquire ONStor, Inc. for approximately $25 million in cash inclusive of assumed debt and other net liabilities.

ONStor, Inc., a privately held company based in Campbell, Calif., provides clustered network-attached storage (NAS) solutions designed to help enterprises consolidate, protect and manage the accelerating growth of unstructured data. ONStor products include NAS gateways, NAS systems and unified storage systems sold to end users through a worldwide network of channel partners and original equipment manufacturers (OEMs).

"The rapid growth of unstructured data is creating significant challenges for enterprises in provisioning, protecting and managing their storage in an efficient and cost-effective manner," said Abhi Talwalkar, LSI president and chief executive officer. "With the addition of ONStor products and technology, LSI will be well positioned to offer a comprehensive set of storage solutions to help enterprise customers effectively manage both their unstructured and structured data with ease."

The transaction is expected to close within thirty days and is subject to satisfaction of customary closing conditions.

LSI expects the acquisition to be roughly neutral to non-GAAP earnings per share in 2009. The company expects to provide further details on July 29 when it reports second quarter results.

Comments

That's a good deal for LSI at a reasonable price.

ONStor, formerly Agile Storage and then ClariStor, was born 9 years ago and already got more than $120 million in financial funding, not including a last financial round at the end of 2008 for an unknown amount from investors Mayfield Fund, Foundation Capital, and Sand Hill Capital. The preceding round was secured earlier in the same year for $14.8 million and was supposed to reach $25 million at the end 2008.

The provider of clustered NAS solutions for primary and value-tier storage for enterprises and content-rich organizations was planning an IPO but finally preferred to be acquired.

ONStor has an excellent NAS technology including the integration of ZFS into NAS gateways. It was working with Nexsan to integrate its virtual file server functionality with SATABoy RAID storage system. Fujitsu is also one of its main partner.

ONStor's Pantera LS 2100 Unified IP storage is a system that can run and manage files and applications from a single device consolidating file-based and block-based access in a single storage platform that supports iSCSI, NFS and CIFS over IP-based network. The system protects data from the disk spindles all the way to applications with features such as RAID-6, checksums, data integrity checking, auto-healing of bad data, replication, and snapshot capabilities.