IBM launches first-ever start-up accelerator
The flash memory storage company has raised $25 million.
EMC Corporation (NYSE: EMC) is in talks to buy storage solutions company XtremIO for $400-450 million and market sources believe that an acquisition is close at hand. In recent months, senior executives from EMC have been in Israel and have been holding aggressive acquisition talks with XtremIO. EMC CEO Joseph Tucci was in Israel in December and since then at least two senior executives have visited from subsidiary VMWare Inc. (NYSE: VMW) - chief technology officer and senior VP Dr. Stephen Herrod and VP finance David Golden.
Senior managers from EMC rival NetApp Inc. (Nasdaq: NTAP) have also been in Israel including the executive responsible for business development and mergers and acquisitions, and the vice president for EMEA.
The two storage giants and other corporations in the hardware market have been holding talks with XtremIO executives.
XtremIO has developed storage systems based on flash memory. The company was founded in 2009 by Aryeh Margi, a co-founder of m-systems; Shuki Bruck, who founded Rainfinity and sold it to EMC Corporation, Yaron Segev, and CEO is Ehud Rokach. The company has offices in Herzliya and San Jose, California.
XtremIO has raised $25 million in two financing rounds and founders and employees are expected to profit handsomely from any exit. Strategic investors include Jerusalem Venture Partners (JVP) and Giza Venture Capital, which each hold 20-30% of the start up, in other words returns of $100-150 million. Other investors include Battery Ventures and Lightspeed Ventures. The klast fundraising round was in late 2011 and the company still probably has several million dollars left to spend from that.
The company has yet to generate revenue and according to its website is conducting trials with customers.
EMC declined to comment on the report.
XtremIO would be EMC's sixth acquisition in Israel and by far its largest. The company operates an Israel R&D center with 700-800 employees.
Published by Globes, Israel business news - www.globes-online.com - on April 22, 2012
© Copyright of Globes Publisher Itonut (1983) Ltd. 2012
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