Cisco snags storage technology for $450 million
The company strikes a $450 million stock deal to acquire NuSpeed Internet Systems in a play to add "storage area networking" technology to its lineup.
Cisco expects a one-time write-off of up to 3 cents for purchased in-process research and development costs related to the acquisition. The deal is likely to be finalized in the first quarter of 2001. It has been approved by each company's board of directors.
NuSpeed's technology ties storage area networks (SANs) to Internet-based networks.
SANs are special-purpose networks designed to split data disk and tape storage technology into a separate, centralized "zone" of a computing system. The approach is easier to manage than when data storage is connected to individual systems and eases the burden on a company's primary network, analysts say.
The technology is becoming increasingly important because of the explosion of data stored on private computers and the Net.
"Data never goes away," said Ammar Hanafi, vice president of business development for Cisco. "That data needs to be connected to the network."
Cisco's latest acquisition marks its 15th purchase so far this year. Executives at the ever-acquisitive company have made clear their intentions to buy 20 to 25 companies this year as part of an ongoing strategy to gain access to new technology and experienced engineering talent.
Earlier in the week, Cisco purchased Komodo Technology for $175 million in stock.
Cisco in June announced a technology partnership with Brocade Communications Systems, a provider of equipment to connect SANs.
NuSpeed was founded in 1999, employs 56 people, and is based in Maple Grove, Minn. NuSpeed chief executive Mark Cree will continue with the company, operating in Cisco's enterprise line of business.