EMC wins battle over Data Domain

EMC has won the financial tug of war to acquire Data Domain for $2.1bn after NetApp lost its nerve and walked away from the negotiating table.


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EMC has won the financial tug of war to acquire Data Domain for $2.1bn after NetApp lost its nerve and walked away...

from the negotiating table.

The board at Data Domain has agreed to EMC's $33.50 per share offer ending weeks of bids and hostile counter bids from the two storage heavyweights.

Last night, NetApp chief executive Dan Warmenhoven capitulated. The company said it could not "justify engaging in an increasingly expensive dilutive bidding war that would diminish the deal's strategic and financial benefits".

Warmenhoven sought to put on a brave face by saying that it remained "highly confident" in its strategy, market opportunities and competitive strengths.

The blow to NetApp may be slightly sweetened by Data Domain's agreement to pay it a $57m termination fee, it also means the company will be able to preserve cash in a recessionary climate.

However, storage specialists recently suggested that whichever firm lost the battle for Data Domain would face an uphill struggle in convincing customers that their de-duplication products were the best bet.

The board of directors at Data Domain stated it had voted in favour of the agreement with EMC.

"The terms of the EMC tender offer are advisable, fair to and in the best interests of Data Domain and its stockholders," it stated.

The tussle between the two storage giants began in May when EMC topped NetApp's initial $1.5bn cash and share offer by $300m.

In early June, NetApp responded by upping its buy price to $1.9bn but only this week EMC again delved deeper into its pockets and came up with $2.1bn for Data Domain.



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