After months of delays, Extreme Networks has officially acquired Brocade Communications' data center switching, routing and analytics business in a move to turn up the heat on competitors including Cisco Systems and Hewlett Packard Enterprise.
"We have now significantly strengthened our position in the expanding high-end data center market with the industry-leading solution for enterprise customers," said Extreme CEO Ed Meyercord in a statement Monday. "Through a series of synergistic acquisitions, Extreme is now a top player in the enterprise networking industry and expects to generate over $1 billion in annual revenues."
The San Jose, Calif.-based networking vendor acquired Brocade customers, some data center personnel, and technology assets including its SLX, VDX, MLX, Workflow Composer, automation suites and other data center-related products for approximately $55 million.
"It's a great strategy to help Extreme expand its presence, customer base, technology portfolio – it's a good deal for the channel, too," said David Rafftery, managing partner at Integration Partners, a Lexington, Mass.-based Extreme partner ranked No. 129 on CRN's 2017 Solution Provider 500 list. "If you're getting close to the data center and you want all the things the Brocade piece offers, you can deploy those features now and you'll have real single-pane-of-glass management over the top. There isn't an enterprise technology networking company today that has their viewpoint."
The Brocade deal provides Extreme with $230 million in sales that the company said will be accretive to earnings and cash flow for its fiscal year 2018, which began July 1.
Brocade is expecting to be acquired by Broadcom by the end of this year but has faced several delays over the course of 2017, including the need for a deeper review of the acquisition by the Committee on Foreign Investment in the United States.
The initial Brocade-Extreme acquisition deal unveiled in March was supposed to take place immediately after Broadcom acquired Brocade. However, in an effort to acquire Brocade assets as soon as possible, Extreme said earlier this month that it would buy Brocade's data center business directly from the vendor itself.
"Our strategic vision has been closely aligned with Extreme Networks' vision throughout this process," said Nabil Bukhari, vice president of Data Center, formerly of Brocade and now with Extreme, in a statement. "Extreme's commitment to build on the innovation and momentum that we have achieved, including a completely refreshed data center portfolio over the past year, will provide our new and existing customers and partners with business continuity that enables them to accelerate digital transformation."