Seagate Technology has acquired Dot Hill Systems, a supplier of software and hardware storage systems, in an all-cash transaction for a total of approximately US$694 million.
As Dot Hill has approximately $49 million in cash on its balance sheet as of June 30, 2015, the transaction reflects an enterprise value of approximately $645 million - the consideration represents a 50 percent premium over the preceding three month stock price average.
According to the tech giant, Dot Hill’s external storage array-based systems and software products will “complement and expand” Seagate’s storage systems offerings and be offered as part of Seagate’s Cloud Systems and Electronics Solutions business.
In addition, Seagate will leverage Dot Hill’s storage technology IP portfolio and software capabilities to drive innovation and provide “incremental value” to their combined OEM customer base.
“Dot Hill’s innovative storage systems and IP portfolio are a strategic addition to our storage technology portfolio, enabling us to accelerate the growth of Seagate’s OEM-focused cloud storage system and solutions business,” says Phil Brace, President of Cloud Systems and Electronics Solutions, Seagate.
“We are focused on providing the highest quality storage systems for our OEM customers and Dot Hill’s storage solutions will enable us to advance our strategic efforts.
“We look forward to welcoming Dot Hill’s strong team, which has proven experience in developing and delivering best-in-class storage solutions that are trusted by the world’s leading IT manufacturers and their channel partners, and we expect the transaction to be accretive to non-GAAP earnings in fiscal 2016.”
In today's interconnected world, Dot Hill storage solutions support people accessing information, and machines collecting sensor data, all in real time.
“Seagate has a strong reputation in enterprise storage and is focused on building out its best-in-class storage system capabilities, making them the right home for the talented Dot Hill team,” adds Dana Kammersgard, CEO, Dot Hill.
“Dot Hill’s customers will benefit from leveraging Seagate’s leading technology and infrastructure to accelerate the delivery of advanced solutions.”