SGI Acquires SGI Japan

SGI intends the acquisition of its namesake to serve as a strategic entry into the technical computing market of Japan. SGI Japan operates primarily as a sales and service organization.

High-performance computer maker SGI has decided to buy SGI for $18 million in cash. Yes, you read that correctly.

Fremont, Calif.-based SGI, once a power in the desktop workstation business as Silicon Graphics Inc., revealed March 9 that it has acquired all outstanding shares of its namesake, SGI Japan, Ltd., from a consortium of investors. Those include NEC, Sony, Canon Marketing Japan, and Morgan Stanley MUFG Securities.

Even though they shared the same name, the two companies were not interacting on a regular basis.

SGI currently produces high-end custom servers, storage arrays, and video-related software -- mostly for military and government customers.

The purchase price of $17.9 million also includes $27 million of net working capital. SGI previously owned 10.4 percent of SGI Japan.

SGI intends the acquisition to serve as a strategic entry into the large technical computing market of Japan, the company said. SGI Japan operates primarily as a sales and service organization.

The acquisition, which closed on March 9, is expected to add more than 400 customers in vertical markets that include government, manufacturing, telecommunications, media and education. SGI will add 272 employees from the current SGI Japan staff.

Chris Preimesberger

Chris Preimesberger

Chris Preimesberger is Editor of Features & Analysis at eWEEK, responsible in part for the publication's coverage areas. In his 10 years and more than 3,500 stories at eWEEK, he has distinguished...