Just a few months after Iomega Corp. announced plans to acquire hard drive maker ExcelStor, EMC, an information infrastructure solutions company, said it would take over Iomega, which specializes in various data storage solutions for consumers and small businesses.
EMC and Iomega said that the two companies had reached a definitive agreement for EMC to acquire Iomega in a cash tender offer of $3.85 per outstanding share, or approximately $213 million. The addition of Iomega’s products, brand name, route to market and industry expertise will enhance EMC’s reach and focus in the rapidly-growing consumer and small business markets.
EMC intends to commence the tender offer in the next two weeks, with completion of the tender offer expected in the second quarter of 2008, subject to customary closing conditions and regulatory approvals. The acquisition is expected to have no material impact on EMC financial results for the full 2008 fiscal year.
“Iomega will play a key role in EMC’s strategy to expand our information storage and management capabilities deeper into the high-growth consumer and small business markets. In addition to industry-leading products and a household consumer brand, Iomega brings to EMC a deep knowledge of and established business practices for servicing consumers and small businesses,” said Joe Tucci, EMC chairman, president and chief executive officer.
Upon completion of the acquisition, Iomega will serve as the core of EMC’s new consumer/small business products division. The new division (led by Jonathan Huberman and reporting to Joel Schwartz, senior vice president and general manager, EMC storage platforms) will also include EMC Retrospect and EMC LifeLine software. EMC plans to build the division around the strength of the Iomega organization, brand, products and partner ecosystem.
“Today begins an exciting new future for Iomega and our customers. Once the acquisition is final, Iomega will be able to fully leverage EMC’s vast assets to grow our business globally. EMC brings to Iomega a new opportunity for accelerated innovation that will translate into new product capabilities for Iomega’s extensive customer base,” said Jonathan Huberman, chief executive officer of Iomega.