CNT Acquires Storage Switch Maker Inrange

Computer Networking Technology hopes having its own switch supplier will lead to lower manufacturing costs.

Computer Networking Technology Corp. has acquired storage switch maker Inrange Technologies Corp. for $190 million in cash, officials announced Monday.

CNT, a publicly owned Minneapolis company, will have lower manufacturing costs and, potentially, lower user prices by having its own switch supplier, officials said in a statement.

"This is exactly what enterprise customers need as a partner in the complex decision-making, large-scale implementation and management of multivendor storage networking solutions," said Thomas Hudson, CNTs CEO, chairman and president.

"Inranges Fibre Channel switches, storage networking and wave division multiplexing products are a strong fit with CNTs Escon, SCSI and Fibre Channel-based IP and wide area network products, consulting, design, implementation and network monitoring," Hudson said.

CNT was founded in 1983 to sell mainframe storage but has focused on selling through other companies bundled solutions in recent years.

"What theyve been really good at doing is allowing customers to extend from their data center to another data center. With the acquisition of Inrange, theyre just trying to increase their market share," said analyst Dianne McAdam, of Data Mobility Group Inc., in Newton, Mass. "What it means is CNT is even more viable."

CNT earned revenue of $211.5 million in 2002, with a loss of $28.5 million. Inrange, of Lumberton, N.J., had revenue of $223.6 million for 2002, with a loss of $14.4 million. Combined, the companies have recurring maintenance revenue of nearly $100 million and a $60 million consulting and professional services division, officials said.

The move has larger effects for enterprise storage users. By becoming part of CNT, Inrange reduces the number of competitors for Cisco Systems Inc., a newcomer to the storage switch market.

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