By Lisa Coleman
On the heels of securing more than $18 million in financing to further fund development of its new optical storage products, Maxoptix acquired tape automation manufacturer Breece Hill Technologies last month for an undisclosed amount. Within 12 to 18 months, and after Maxoptix completes a third round of financing this spring, the newly combined company plans to go public.
Both Maxoptix's and Breece Hill's tape and optical product lines will be consolidated into one automation product line, says Fred Bedard, Maxoptix senior vice president of sales and marketing. To avoid customer confusion, the combined company will sport a new, yet-to-be determined name that will encompass both independent automation lines, according to Bedard. The Maxoptix and Breece Hill names will be dropped.
"We're buying a company that has a lot of technology to offer," says Bedard. "I believe, through this acquisition, that our strong balance sheet with another round of financing will enable us to market this joint company as one secondary storage product company."
Breece Hill has been on the auction block for over one year. In 2000, Tandberg Data withdrew its bid to buy Breece Hill for a reported $12 million. In October 2000, Maxoptix took notice of Breece as a possible asset and pursued the acquisition. According to Bedard, Breece is profitable and has reinvested its money in research and development rather than marketing or advertising. New AIT-based tape technology and autoloaders will be introduced in the spring.
Maxoptix has received more than $30 million in two rounds of financing to develop its Optical Super Density (OSD) technology. OSD will offer up to 20GB of random-access capacity on a single, double-sided optical disc. OSD drives are expected to ship mid-year. A final round of financing will be used for OSD development, with some funds earmarked for the newly combined company, according to Bedard.