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Adaptec buy spawns IP spin-off

Two acquisitions yielded one spin-off company this week when the iSCSI business arm of Eurlogic Systems became a standalone company.

Days after being gobbled up by Adaptec Inc., in an acquisition, Eurologic Systems Inc., has spun-off its IP SAN unit into a standalone company called Elipsan, Bristol, U.K.

Eurologic said its IP SAN division was formed in February 2000 as a separate business unit, through the acquisition of network archival software company K-PAR Systems. It created Elipsan to maximize the market opportunity, Eurologic said.

But one expert believes Adaptec Inc., Milpitas, Calif., didn't need the iSCSI arm of Eurlogic because its own IP storage arm was already fully loaded.

Steve Duplessie, analyst and founder, Enterprise Storage Group Inc., Milford, Mass., said Adaptec did not need Eurlogic's IP storage technology.

"Adaptec didn't need the iSCSI stuff, they are already light years ahead of Eurologic," he said.

Earlier this week, Adaptec reached a definitive agreement to acquire Eurologic Systems Inc., a provider of external and networked storage hardware.

Adaptec made the purchase to solidify its position in the direct-attached server storage market in terms of block and file-based storage systems. Adaptec expects the acquisition to be completed this month.

Eurologic's family of external and networked storage products includes JBOD, RAID, SCSI, Fibre Channel and Serial ATA solutions, which are sold through OEMs and resellers. Eurologic is headquartered in Dublin, Ireland, and has approximately 150 employees.

The acquisition cost Adaptec $30 million. Eurologic will become part of Adaptec's Storage Solutions Group.

Mike Fisch, analyst with the Clipper Group Inc., Wellesley, Mass., said Adaptec acquired Eurologic to bolster its external storage line and possibly to gain additional channels to market.

"Eurologic has a number of large customers like Acer, Avid Technology, and Fujitsu-Siemens, some of which may be net new to Adaptec," he said.

Fisch said the Elipsan spin-off was apparently planned for a while and not necessarily related to the Adaptec acquisition.

"I don't know what Eurologic's motivations were. Perhaps they felt that they had a good product but not enough resources to adequately develop the nascent iSCSI storage market," he added.

Let us know what you think about the story, e-mail Kevin Komiega, News Writer


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