Article

Users wary after Plasmon buyout threatens headquarters move to US

Antony Adshead, UK bureau chief, storage
Plasmon CEO Steve Murphy has negotiated a private equity buyout of the struggling maker of optical storage media for a sum believed to be in the region of $25m from administration-bound UK-based parent Plasmon Ltd and will likely move its headquarters from the UK to the US.

Murphy has bought Plasmon Inc from UK administrators Kroll along with its intellectual property, assets and subsidiaries in the USA, Italy, Belgium and Asia as well as customer contact details. Murphy becomes the CEO and only director of the new company, Plasmon Inc.

With the likely move of Plasmon's base to the US, the company's users in the UK are eyeing the situation carefully with regard to likely future levels of support.

"Obviously it is disappointing, as it was a plus that Plasmon was a UK-based vendor and we always look for British-based support," said one Plasmon customer, which uses the vendor's hardware for long-term archiving. "We will have to look carefully at how the company moves forward and consider whether Plasmon is the best optical systems for us – there is always Blu Ray to think about. Having said that, we like Plasmon's product and given the nature of archiving there won't be any snap decisions."

Plasmon went into administration in early September when its funders Hanover Investors called in the administrators following a dip in sales revenues. Despite that, IBM signed a partnership deal with the company earlier this month.

Analyst Simon Robinson of The451 Group said the fact that the buyout had succeeded in the current climate as well as the recent partnership of Plasmon with IBM showed there was some hope.

"Despite what has happened, for a deal to be done with IBM in the past few weeks shows there is some solidity to the business," Robinson said. "If you wanted any company to show their faith in your in times of difficulties, it'd be IBM. The drive to green storage has seen a resurgence in optical media which is regarded as having the power-saving attributes of tape with the accessibility of online media."


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