Dell to acquire startup ConvergeNet

Posted on October 01, 1999

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Dell to acquire startup ConvergeNet

Zachary Shess

Dell Computer took a significant step toward offering heterogeneous storage area network (SAN) functionality last month by acquiring San Jose-based ConvergeNet Technologies in a stock swap worth approximately $340 million. The acquisition is expected to close next month.

The acquisition enables Dell to leverage ConvergeNet`s Storage Domain Manager software technology for its PowerVault storage line. Currently in beta testing, Storage Domain Manager provides centralized SAN management for heterogeneous environments, thereby improving performance, availability and storage management functionality.

"Now we have a more robust heterogeneous offering with more intelligence to manage storage assets... across operating systems, host platforms and processors," says Kevin Reinis, general manager of Dell`s storage systems division.

"Dell gives us market clout, distribution, and support infrastructure," says Dick Watts, ConvergeNet`s president and CEO. Watts will stay on as vice president and general manager of Dell`s storage systems division.

While its first acquisition in company history clearly shows Dell`s SAN commitment, the $340 million price tag for a two-year-old company with no shipping product raised eyebrows among industry observers. ConvergeNet demonstrated Storage Domain Manager technology at Networld + Interop last month in At-lanta, but it`s not expected to ship until next year.

John McArthur, director of storage systems research at International Data Corp., in Framing- ham, MA, says the technology will be a crucial step toward true heterogeneity for SANs. "It would be the Holy Grail if it was shipping," he says. "What we`re talking about here is putting an awful lot of function in a storage server." (For more information on Storage Domain Manager, see InfoStor, September, p. 26.)


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