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EMC buys Legato Systems in mammoth deal

Storage giant EMC buys Legato in mammoth deal

EMC Corp. has long been heralded as the biggest third-party storage vendor in the world. It just got bigger.

The Hopkinton, Mass.-based company accelerated its push into the storage software market today when it announced plans to acquire backup and archiving specialist Legato Systems Inc., Mountain View, Calif., in an all-stock deal valued at approximately $1.3 billion.

EMC said the addition of Legato's heterogeneous information protection and recovery, HSM (hierarchical storage management), automated availability and e-mail and content management technologies will expand EMC's portfolio of open storage software, making it easier for customers to access, manage and protect all of their information.

Joe Tucci, EMC's president and CEO, said it was either develop software in house or buy the technology from an existing vendor.

"EMC will get the benefits of Legato's best practices and receive a healthy dose of new software DNA," he said.

Tucci said the acquisition will speed EMC's time-to-market with information life cycle management solutions.

Legato's products include NetWorker, DiskXtender, AlphaStor, ApplicationXtender, EmailXtender AppPanel, Co-StandbyServer AAdvanced, AAM and RepliStor. NetWorker will become EMC's primary backup and recovery offering.

EMC will support Legato's products and existing customers. It plans to maintain the Legato brand as a separate entity and integrate functionality from its own software line. EMC will eventually be dropping its Enterprise Data Manager (EDM) product in favor of Legato's data management offerings, the company said.

John MacArthur, vice president of storage research for International Data Corp., Framingham, Mass., said the acquisition of Legato gives EMC a more significant presence in the backup market and reassures those that are using Legato NetWorker.

MacArthur said persistent rumors around the sale of Legato have left some customers questioning where to put their software dollars. Now that issue is off the table. "EMC has made it clear that they are going to support an enhanced version of NetWorker," he said.

EMC also plans to use Legato's sales organization, channel partner relationships, service capabilities and 450 software engineers to solidify its position atop the storage market.

EMC will operate Legato as a software division based in Mountain View, Calif. David Wright, Legato's chairman and CEO, will lead the Legato business unit within EMC as an executive vice president.

Legato's sales, marketing and service will remain focused on selling and servicing the full line of Legato products. EMC said the companies will fuse their respective engineering and development efforts.

This is the second big software move EMC has made in as many weeks. Last week, EMC acquired the rights to BMC Software's Patrol Storage Manager software and announced that Houston-based BMC will resell EMC's ControlCenter family of products as its storage resource management offering.

The move followed BMC's decision to pull out of the storage management market.

Let us know what you think about the story. E-mailKevin Komiega, News Writer

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