Greene: No Major Acquisitions for VMware

By Scott Ferguson  |  Posted 2007-09-11 Print this article Print

VMware is eyeing acquisitions, but CEO Diane Greene does not see a major purchase coming anytime soon.

SAN FRANCISCO – VMware is looking to grow and the virtualization giant is prepared to acquire other companies to help it increase its presence and its product line. At a question and answer session with reporters at the 2007 VMware Conference Sept. 11, Diane Greene, VMwares president and CEO, said that while her company is prepared to buy other businesses, VMware is not planning a major purchase anytime soon.
"We dont anticipate a large acquisition," Greene said during the session with journalists. "That being said this is an opportunistic business and we are keeping our eyes and ears open. However, I dont see a large acquisition anytime soon."
What Greene and her management team are looking for are companies with either technology or solutions that can help grow or strengthen VMwares product line, such as its Virtual Infrastructure suite. On Tuesday, VMware announced that it would acquire Dunes Technologies for an undisclosed sum. The vendor, based in Lausanne, Switzerland, specializes in software that allows customers to automate workflows for managing their virtual environments. Click here to read Diane Greenes opening address to the 2007 VMworld Conference. When VMware launched its initial public offering on Aug. 14, the money raised from the initial sale of 33 million shares were expected to raise more than $900 million in capital, making VMwares estimated worth now stand at more than $10 billion. With that money, the company plans on paying down a loan to its parent company, EMC, buying back its Palo Alto, Calif., campus from EMC and acquisitions to help the business expand. After the IPO, Greene said she expects the company to expand into several area, especially the growing field of desktop virtualization with its ACE, Fusion and Workstation products. The company also unveiled its Desktop Manager 2 product at Tuesdays show. For a closer look at server virtualization management, take part in Ziff Davis Enterprises live, interactive eSeminar Sept. 12 at 4 p.m. EDT. As for the rest of the virtualization industry, Greene said the $500 million acquisition of XenSource by Citrix in August and the eventual deployment of Microsofts Viridian hypervisor with the companys Windows Server 2008 products means the industry is poised for serious growth as the decade comes to an end. "We are pretty bullish about what has been going on," Greene said. As for VMwares own business model, now more than 80 percent of the companys revenues come from products outside its own hypervisor. Still, the hypervisor remains a core part of the businesses and Greene said she did not see the company building other products to support or manage a different hypervisor. "We have the most reliable hypervisor in the x86 [market] if not the [most reliable] system software in the x86 space and thats not to be discounted… We have a revenue model from all the value that we bring out," Greene said. Check out eWEEK.coms for the latest news, views and analysis on servers, switches and networking protocols for the enterprise and small businesses.

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