SanDisk Corp., a leading supplier of NAND flash-based devices, on Monday announced a definitive agreement to acquire Pliant Technology, a leading developer of enterprise solid-state drives (SSDs).
Pliant currently sells ultra-high performance enterprise solid state drives based on the SAS protocol to meet the demanding performance, data integrity and reliability needs of enterprise storage customers. The company's product roadmap also includes PCIe-based solutions for high-performance compute servers. Pliant is a leader in the use of multi-level cell (MLC) NAND in enterprise SSDs, and the lower cost of MLC is a key enabler for the broad adoption of SSDs in the enterprise market.
"Flash memory is making significant inroads into the enterprise by dramatically increasing application performance and reducing power consumption. We believe that the combination of Pliant's innovative technology and enterprise-level system expertise with SanDisk's high-quality, large-scale MLC memory production is a winning value proposition for customers. Our advanced flash technology roadmap and flash management capability will complement Pliant's strengths and allow us to lead the way in reliability and performance in the Enterprise SSD market," said Sanjay Mehrotra, SanDisk president and chief executive officer.
Under the terms of the agreement, SanDisk will pay approximately $327 million in cash and provide certain equity-based incentives. The transaction, which has been approved by the boards of directors of both companies, is subject to customary closing conditions, including regulatory review and approval, and it is expected to close by the end of SanDisk's second fiscal quarter. SanDisk expects the transaction to be dilutive to its non-GAAP earnings by 2% to 3% in fiscal year 2011 and accretive to non-GAAP earnings in fiscal year 2012.
"The Enterprise SSD market is poised for considerable growth, with revenue projected to reach $4.2 billion in 2015, up from $994 million in 2010. This trajectory is fueled by the expanding use of MLC NAND technology, which will require extensive flash management expertise to ensure successful adoption in enterprise applications," said Joseph Unsworth, research director at Gartner.