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IBM To Acquire Storage Management Vendor Softek
9:00 AM EST Mon. Jan. 29, 2007
Softek provides a range of storage products and services designed to help companies store critical business data and safely move it from system to system. Its customers include British Telecom, Lufthansa, and the Principal Financial Group.
The deal, which follows IBM's announced divestiture of its printer division last week, marks the latest step in the company's campaign to transform itself from a so-called legacy hardware manufacturer to a provider of high-growth, high-margin software and services.
Softek's revenue increased 24% year over year in its most recent fiscal quarter, according to a statement from the privately held company.
IBM will add Softek to its Global Technology Services unit, rather than its software group. The move implies that the company plans to offer Softek's storage management technology through managed services deals. The company made a similar move last year when it acquired Internet Security Systems to bolster its security services offerings.
The deal should also help IBM continue its strong momentum in the storage market of late. According to a December report by IDC, IBM grew storage software revenue by 39% year over year, outpacing rivals EMC and Symantec.
As part of IBM, Softek will likely enjoy continued strong demand for its products and services. Regulations such as Sarbanes-Oxley and electronic discovery rules are requiring corporations to create more sophisticated data storage networks. Corporate storage capacity is growing at a rate of 68% annually, according to Softek.
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