Search
Homepage Rankings and Research Companies CRNtv Events WOTC Jobs Tech Provider Zone

Another Split: Raritan To Break Up, Sell Hardware Business To Legrand

Raritan reveals plans to split the company, selling the hardware part of the business to Legrand and forming a stand-alone software unit.

Data center vendor Raritan said Tuesday that it plans to split the company, selling the hardware side of the business to French infrastructure firm Legrand and forming a stand-alone unit encompassing its software-based data center management business.

Somerset, N.J.-based Raritan said it will rename its stand-alone data center infrastructure management (DCIM) business Sunbird Software. The 850-customer company will be led by Herman Chan, currently Raritan's senior vice president of marketing and general manager of its DCIM business.

The Sunbird spinoff won't occur until the Legrand acquisition closes, the company said, which is expected be within the next two months. Until then, the power distribution unit (PDU) and keyboard, video and mouse (KVM) switch section of the business will retain the Raritan name, the company said.

[Related: 2015 Data Center 100: 20 Data Center Tool Providers]

Although Sunbird plans to split from Raritan, Chan said in a statement that Sunbird will continue to support Raritan's hardware while at the same time working with a broader set of vendor partners.

"Sunbird is a leader in the growing DCIM software market and will become a nimbler, more agile company enabling the best customer and partner experience with its additional focus," said Chan in a statement. Raritan and Legrand declined to comment further.

Raritan's hardware businesses employ about 350 in North America and generate $114 million in annual sales, according to Legrand. Two-thirds of that revenue comes from the U.S., which is Raritan's largest market. Legrand, meanwhile, reported global sales of $5.06 billion in 2014.

Ashley Fox, Raritan's director of American channels, said in the 2015 Women of the Channel questionnaire that Raritan has increased its head count and presence within the channel to drive greater partner enablement. The company is also reinvigorating its channel approach, Fox said, emphasizing the channel as the "most appropriate route to market for Raritan's products and services.

Raritan grew its active partner community by 5 percent in 2014 and increased channel revenue for the DCIM product line by 35 percent over that time, Victoria Zona, Raritan's former channel sales director, said in CRN's 2014 Channel Chiefs questionnaire.

Raritan also expanded its channel marketing organization last year, Zona said at the time, giving partners more opportunities to co-market with partners and helping them more easily qualify opportunities and close deals for Raritan products.


"Both Legrand and Raritan are good companies offering good products," said John Karel, CEO of ABcom, a New Brighton, Minn.-based solution provider that has a long standing relationship with several Legrand entities as well as Raritan's power distribution unit. He said he is excited to see what the two companies will accomplish now that they're joining forces.

One unidentified channel partner, however, said he is worried that Raritan's commitment to backward compatibility -- which allows customers to integrate newer technology equipment with Raritan's legacy equipment -- could end once the company becomes part of Legrand.

"My concern is that Legrand will not be interested in all of Raritan's products and will let some wither away," the partner told CRN in an email. "This is what happened when Emerson picked up Avocent [in 2009]. Legacy customers get let down."

Raritan's DCIM products have also been a tough sell, the partner said, since the client's entire workforce must get on board for it to work effectively. Additionally, the partner said, DCIM sales are typically hammered out as a direct sale between Raritan and end-user executives, leaving resellers with little to do other than provide instructions to Raritan's workforce.

Despite his being one of just 42 channel partners listed on Raritan's website, the solution provider said, no one from the vendor reached out to tell him about the split and acquisition.

"This is news to me," the partner wrote. "I knew something was up when they started shedding the sales people over the last few months."

At the same time, the partner said, there was no compelling reason for Raritan to keep its hardware and software product lines together. That's because Raritan's DCIM products still need to be designed to integrate with PDU and KVM products from competing vendors, because customers still have those other vendors in their ecosystem.

Raritan is the latest of nine acquisitions Legrand has made since 2009. Other U.S. purchases include Middle Atlantic Products, Electrorack, NuVo Technologies and Lastar Inc.

Raritan is the sixth major technology company to announce a split over the past several months in response to market pressure from the shift to cloud computing. Other technology companies announcing split or spinoff plans include CSC, Hewlett-Packard, Symantec, IBM and eBay.

MICHAEL NOVINSON contributed to this story.

PUBLISHED JUNE 17, 2015

Back to Top

Video

 

sponsored resources