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Update: EMC seals deal, sorts out Legato products

It took more than 100 days and $1.3 billion, but EMC's acquisition of software maker Legato Systems is complete. So now what?

It's official. In little more than 100 days, EMC has completed its acquisition of software maker Legato Systems Inc., giving the company a huge presence in the software market, a west coast division and a wealth of storage engineers and customers.

Under the terms of the deal announced last July, EMC issued approximately 106 million shares of EMC common stock for all outstanding shares of Legato. All told, EMC shelled out approximately $1.3 billion. EMC will operate Legato as a division of EMC with headquarters in Mountain View, Calif.

"We are thrilled with the speed and efficiency at which we closed this transaction," said Joe Tucci, EMC's president and CEO. "We've spent the last 100 days developing a bullet-proof integration playbook and are prepared and excited to move forward as a combined company."

The Legato Software division of EMC will be led by David Wright, Legato's former CEO. Wright reports to Joe Tucci as an executive vice president of EMC and president of the division.

EMC said the two companies assembled a cross-company team of experts and business managers to analyze and plan for Legato's integration into EMC.

Members of Legato's management team will oversee the new division's sales, marketing, alliances, services and human resources. Legato's sales and distribution channels will operate independently from EMC, and Legato's partnerships and selling focus will stay the same.

The EMC development team responsible for backup and replication management software will join with Legato's existing research and development group to form a new software development organization. The group will be led by EMC Senior Vice President Mark Sorenson, who will report to both Wright and Mark Lewis, EMC's executive vice president of open software operations.

Though it hasn't been made public, EMC said a detailed, multi-year product roadmap is in place for every product in the Legato division, including transferred EMC products, with plans to storage software for multivendor storage environments.

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.

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 drop its Enterprise Data Manager (EDM) product in favor of Legato's data management offerings, the company said.

"We're not going to change the way we do things. [However], it knocks a couple of our hurdles out [of] the way," said Legato's Chief Technology Officer George Symons. "It has wiped out the question of 'Will Legato be around?' Our [newfound], long-term viability means key customers who wouldn't even look at Legato before will evaluate the products now. We now have longevity, a healthy balance sheet and the ability to add [research and development] resources that we wouldn't have had before."

Legato stockholders approved the acquisition on Monday.

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

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