Imation, known for its digital tape, compact disc, portable solid-state drive products for consumers and small businesses, made a move Jan. 2 to bolster its midrange enterprise storage catalog by acquiring network-attached storage system maker Nexsan.
The $120 million cash-and-stock transaction included $105 million in cash and 3,319,324 Imation common shares, currently worth about $15 million.
Thousand Oaks, Calif.-based Nexsan, one of the smaller independent enterprise storage providers, has maintained close partnerships with Toshiba (for solid-state drives) and Veeam (for backup and replication software) for the last few years and has more than 11,000 customers worldwide—mostly in small and midsize businesses (SMBs).
Nexsan gives Imation something it has never had: a standalone lineup of disk-based and hybrid disk and solid-state, data center-ready storage systems.
Nexsan: File- and Block-Based Storage
Nexsan's solid-state unified storage systems, known as the NST series, provide both file-mode (network-attached storage, or NAS) and block-mode (iSCSI) storage. The NST series combines solid-state storage with Serial ATA (SATA) and SAS drives via Nexsan's FasTier acceleration IT.
FasTier automatically and intelligently uses the speed of solid-state memory in a fault-tolerant architecture to accelerate the performance of SAS and SATA spinning media. Prices start at $16,000 and scale up, based on configuration.
NST unified storage systems with FasTier are designed to optimize caching and tiering by using dynamic RAM and flash-based solid-state memory, along with spinning media, to triple real-world random I/O performance. The new NST systems combine FasTier's software with up to 24 Xeon CPU cores, 192GB of DRAM, 12 dedicated RAID engines and up to 1PB (petabyte) of storage capacity.
Oakdale, Minn.-based Imation will provide Nexsan with global scale and a better-known brand to promote global expansion.
Imation a Spinoff of 3M
Imation, born in 1996 when 3M spun out its data storage business, started out by making magnetic tape products only. In February 2011, the company announced an expansion to four core product technology areas: secure storage, scalable storage and wireless/connectivity—to go with magnetic tape.
"Our strategy includes focusing on the underserved SMB market with purpose-built storage systems and appliances," Imation President and CEO Mark Lucas said. "This is a market that Nexsan knows well."
Privately held Nexsan, founded in 1999, has grown its business from startup to more than $82 million per year with gross margins in the 40 percent range, Lucas said.
CEO Philip Black will make the transition to Imation, Lucas said. About 200 Nexsan employees, based in the U.S., U.K. and Canada, will join Imation in the acquisition. Nexsan will continue to operate from its current headquarters in California under existing management.