Overland Storage becomes part of Sphere3D
Two reds will make a black, backers hope
Overland Storage is merging with Sphere 3D; two loss-making companies hoping to come good by coming together.
Overland has become a wholly-owned subsidiary of Canadian Sphere 3D, and Sphere 3D Corporation will trade on Nasdaq.
Both boards approved the deal as did Overland's shareholders; 99 per cent of the shares were voted in favour of the deal. But then there was alternative on offer for these stricken shareholders.
In its latest results, for the third 2014 quarter, Sphere3D revenues of $1.6 million showed a decline year-on-year, bur a 7 per cent rise q-on-q. There was a net loss of $3.8 million (these are Canadian dollars by the way). CEO Peter Tassiopoulos blamed transitions taking place in advance of the merger with Overland.
For its part Overland's last reported results were dire too; revenues of $22.9 million and losses of $7.3 million ($US).
Add the two together at a crudely simplistic level and we get a $11.1 million loss on revenues of $24.5 million. Net profit for either company in the past was elusive and the future is, to say the least, uncertain.
Sphere3D describes itself as "a leading provider of virtualisation technology solutions." With quarterly revenues of $1.6 million it's not likely to trouble VMware any time soon. There's background on Sphere 3D and its Glassware and V3 technologies here. Sphere hopes Overland's channel will be able to popularise its products.
The combined company claims:
"The integration of the Overland Storage, Tandberg Data, V3 Systems, and Sphere 3D brands positions the company to deliver a comprehensive and innovative portfolio of virtualisation and cloud solutions. Through offerings designed for active data and data at rest, the company is able to address the rapidly growing cloud, virtualisation and data storage markets in the software-defined IT arena."
It's a good gloss on what might strike some as a collection of disparate technologies; Tandberg tape, Overland tape and disk, and Glassware's unproven - in market success terms - Glassware and V3 VDI technologies.
Hope springs eternal, especially in the mind of backer Cyrus Capital which was instrumental in Overland taking over Tandberg Data.
Eric Kelly is chairman and CEO of the new Sphere 3D corporation while the previous Sphere 3D CEO, Peter Tassiopoulos, is vice chairman and president. Overland CFO Kurt Kalbfleisch becomes CFO of the new company.
We'll look forward to seeing how it pans out. ®