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Dell Buys Compellent (CML) - Who Gets Acquired Next in Storage?
Dell Buys Compellent (CML) - Who Gets Acquired Next in Storage?
TechStockProspector.com
A DealBook piece in today’s The New York Times says NetApp (NTAP, $55.58) could
be the next storage takeover target. We’ve heard this many times before, and at
much lower levels for NetApp shares—the stock is up 62% YTD.
But with a market cap now above $20 billion, NetApp would represent a difficult-to-
pull-off acquisition for anyone but the biggest tech players (such as Oracle, Cisco or
HP). I’ve argued in the past that Oracle should make a run at NetApp, laying out
valuation parameters for a potential deal.
This Times article says Cisco might be better positioned at the moment because
Oracle still has its hands full integrating Sun. Plus, Cisco does covet a bigger
presence in storage. NetApp is an attractive asset as evidenced by its revenue
growth (expected to be +27% in fiscal 2011) and recent market share gains (see
table below). The only problem would be that hefty price tag.
Worldwide External Disk Storage Array Market (IDC, Q2 2010)
Vendor Market share Market share gain
y/y
1-EMC 25.7% +470 basis points
2-IBM 13.6 -50 basis points
3-NetApp 11.4 +300 basis points
4-Hewlett-Packard 11.3 +60 basis points
5-Dell 9.4 +20 basis points
6-Others 28.7 -800 basis points
I have a couple ideas about the next potential buyout targets in storage. Read about
them in the latest issue of TSP Deal Report, which includes my updated list of the
most likely tech acquisition candidates for 2011. My 10 buyout candidates for 2010
are up an average of 78% over the past 12 months. Single copies of the latest report
are available via e-mail for $325. To order, call 800-392-0998.
Rob DeFrancesco is a former senior writer with Louis Rukeyser’s Wall Street.
TSP Deal Report is a weekly e-mail newsletter focused on tech M&A. Each issue
covers the latest developments in the tech deal world and includes an updated
list of potential buyout targets. Annual subscription: $1,045.