Imation has announced its intention to acquire Memorex International, in an all-cash transaction of $330 million plus payments ranging between $5 million and $45 million to be paid out over a period of three years once the deal closes, contingent on the financial performance of Memorex.
By adding Memorexs recordable media capabilities to its removable data storage media product set, Imation gains a significant foothold in the booming consumer-based recordable CD and DVD sector.
Imation already provides SMB (small and midsize business) customers with flash devices as well as CD and DVD disks used to store and manage business data, as well as video, photos and images found on most desktops and laptops.
On the enterprise side, Imation offers tape cartridges to backup, secure and archive data and applications within data centers and distributed networks. The company also has enterprise traction via its e-mail archiving appliance, according to Imation officials.
By having Memorex under its wing, Imation should be poised to benefit from the expected proliferation of U3 smart drives. Currently available, the pint-sized flash drives are designed to allow users to save and carry their settings, data and applications on a tiny device which can be plugged into any PC for instant access.
U3 has lined up Memorex, in addition to Kingston Technology Company and Verbatim Corp., as equipment manufacturers of the USB U3 smart drives.
The vendors are partnering with SanDisk and M-Systems to help push the new technology and help overcome lingering security and licensing obstacles associated with the new flash drives by some critics.
Once the acquisition closes, Michael Golacinski, president and CEO of Memorex, will be in charge of Imations consumer business at the Cerritos, Calif., Memorex headquarters.