Sun snags storage company, software maker

The computer maker acquires data storage company HighGround Systems in a stock deal worth roughly $400 million and buys software maker GrapeVine Technologies for an undisclosed amount.

In a holiday-season buying spree, Sun Microsystems has not one, but two companies coming across its horizon.

Sun, based in Palo Alto, Calif., on Monday announced its acquisition of data storage company HighGround Systems in a stock deal worth roughly $400 million and its purchase of software maker GrapeVine Technologies for an undisclosed amount.

Aiming to expand its reach in storage management, Sun intends to fold HighGround's set of data storage management products into its network storage group. Privately held HighGround, based in Marlborough, Mass., provides software that handles storage monitoring, analysis, reporting and event management.

The move is part of Sun's efforts to push widespread use of its storage products. The company last quarter reported 50 percent revenue growth for its storage products, fueled by the debut of its T3 "Purple" network-attached storage server. Still, some financial analysts at the time said customers were viewing the T3 warily and that Sun needed to crack the high-end enterprise market for storage.

Under the terms of the deal, Sun said it will purchase HighGround in an all-stock transaction worth approximately $400 million. The agreement is expected to close in Sun's third quarter, ending March 30, 2001, and is subject to governmental approvals, HighGround stockholder approval and customary closing conditions.

In related news, Sun is acquiring GrapeVine Technologies, a maker of knowledge management software--applications that manage static information and Web resources that workers use to make business decisions.

Financial terms of this deal were not disclosed.

Sun plans to integrate GrapeVine's product with portal server software from iPlanet, the alliance between Sun and Netscape Communications. The combination of GrapeVine knowledge management tools with iPlanet's portal software will allow businesses to incorporate search, indexing and other resources into their portals.

GrapeVine's search and indexing software will become free, standard features of iPlanet's portal server. GrapeVine's knowledge management applications will be available with iPlanet's portal server as an add-on. The combined products will be available in early 2001, the companies said.

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