Novell Acquires PlateSpin for $205M

Novell announced Feb. 25 that it will acquire Toronto-based virtualization management software and services provider PlateSpin Ltd. for $205 million in cash.

It was the second acquisition Novell has revealed in 12 days. The Waltham, Mass.-based enterprise software maker bought open-source team collaboration software provider SiteScape -- founder of the ICEcore open-source collaboration project -- on Feb. 13.

Five-year-old PlateSpin specializes in data center management software that enables workloads to run smoothly across varying types of systems, whether on physical or virtual servers.

Novell President and CEO Ron Hovsepian told a conference call of reporters, analysts and investors that these two acquisitions fill key missing elements in Novell's product lineup.

"This is a great marriage of technologies and people, with no overlaps," Hovsepian said. "PlateSpin brings a powerful set of products and some big customers [such as British Petroleum], and we bring our own great technologies plus our strong partner capabilities to the equation.

Resource Library:

"The PlateSpin acquisition will be a cornerstone of our two-pronged enterprise Linux and IT management software strategy," Hovsepian said.

PlateSpin's operating system-agnostic, consolidation-planning and performance-monitoring tools fill a hole in Novell's product line, Joe Wagner, Senior Vice President and General Manager of Novell's Systems and Resource Management business unit, said.

"Independent of whatever hypervisor a system is using, PlateSpin's tools can give a data center more efficient use of its resources, cost savings due to drawing less power for servers and cooling, and much better efficiencies of scale," Wagner said.

Novell and PlateSpin already have partnerships with VMware, Citrix Xen, Unisys, Virtual Iron and Microsoft (for the upcoming Hyper-V). All of both companies' server software works with all of those hypervisors, Wagner said.

"Flexible, automated management products that fully leverage server resources and allow the movement of workloads are necessary for optimizing the data center," said Stephen Elliot, an analyst and research director at IDC.

"Over the next three years, heterogeneous virtualization architectures will be the norm for most IT organizations; as such they must purchase data center management solutions that offer an ongoing opportunity for lowering operational costs as well as integrating and managing VMs across both server and storage infrastructures for greater control and visibility between hardware and the virtual software tiers."

PlateSpin's product suite automates the assessment and migration phases of data-center initiatives, such as server consolidation, data-center relocation and hardware upgrades. The company's disaster-recovery software uses virtualization to protect both physical and virtual servers in the data center, and its provisioning software gives users a single approach to imaging and configuring physical and virtual workloads -- regardless of platform.

PlateSpin's optimization and management software automatically monitors and makes infrastructure adjustments based on server availability and workload demand, in order to increase server utilization and availability.

Stephen Pollack, founder and CEO of PlateSpin, will remain with Novell, as will all 125 of its employees.

"When I founded PlateSpin five years ago, I never suspected that we would eventually become the center of such a powerful trend [data center virtualization]," he told the conference.

The acquisition is expected to close during Novell's second fiscal quarter 2008.