Feeds

Evaporating Adaptec sells RAID business

PMC-Sierra gets it

Secure remote control for conventional and virtual desktops

Adaptec is selling its RAID channel storage business to PMC-Sierra for $34m, but will keep its Aristos ASIC technology business as it looks for ways to invest its $400m cash pile.

Activist investor Steel Partners gained control of Adaptec a few months ago and is now asset-stripping the business. Adaptec as a RAID adapter company is now dead, and the company consists merely of its portfolio of more than 200 patents, the Aristos ASIC stuff, a few buildings and - the crown jewels, we think - that $400m.

PMC-Sierra said the channel storage business includes Adaptec's RAID storage product line, a well-established global value added reseller customer base, board logistics capabilities, and leading SSD cache performance solutions. PMC-Sierra will also assume certain liabilities related to the business.

Greg Lang, PMC-Sierra's president and CEO, said: "I am excited about this acquisition and the future growth opportunities it presents through the strong strategic fit between our core strengths in enterprise storage and the established channel storage business of Adaptec."

PMC-Sierra expects to employ approximately 90 people from Adaptec located in seven different geographies, with the majority in California.

The Adaptec board stated that it will: "...explore all strategic alternatives to deploy the proceeds of the sale and the Company's other assets, which may include stock buybacks, special cash dividends, future acquisitions and other actions to redeploy capital. Additionally, the Company will, as previously announced, continue to consider its options related to its Aristos ASIC technology business, remaining patents and real estate holdings."

This looks like longhand for saying that everything Adaptec owns is up for sale, and its cash may be used to fill shareholders' pockets directly or to buy other companies. Adaptec is in effect a cash-rich shell.

One odd aspect of the deal, according to Howard Marks of testing lab DeepStorage, is that PMC-Sierra is a chip company and would have wanted the Aristos chip business. The deal as it stands doesn't make sense to him, and Marks thinks that there must be some other aspect to it.

Jack Howard, Adaptec's chairman, said: "This transaction with PMC-Sierra, which represents the sale of a small portion of the Company's total assets ... continues the process of moving the Company away from its previous unprofitable identity as a 'pure-play' technology company. The Board of Directors remains committed to providing value to all of the Company's stockholders, and will aggressively pursue opportunities to deploy the significant cash and liquid assets on hand to create value for the Company's stockholders."

The RAID business sale to PMC-Sierra should close in thirty days. Farewell Adaptec - you're just another storage memory now. ®

Secure remote control for conventional and virtual desktops

More from The Register

next story
Ellison: Sparc M7 is Oracle's most important silicon EVER
'Acceleration engines' key to performance, security, Larry says
Linux? Bah! Red Hat has its eye on the CLOUD – and it wants to own it
CEO says it will be 'undisputed leader' in enterprise cloud tech
Oracle SHELLSHOCKER - data titan lists unpatchables
Database kingpin lists 32 products that can't be patched (yet) as GNU fixes second vuln
Ello? ello? ello?: Facebook challenger in DDoS KNOCKOUT
Gets back up again after half an hour though
Hey, what's a STORAGE company doing working on Internet-of-Cars?
Boo - it's not a terabyte car, it's just predictive maintenance and that
prev story

Whitepapers

A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
Storage capacity and performance optimization at Mizuno USA
Mizuno USA turn to Tegile storage technology to solve both their SAN and backup issues.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Beginner's guide to SSL certificates
De-mystify the technology involved and give you the information you need to make the best decision when considering your online security options.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.