Adaptec Pays $30 Million For Eurologic, Makes External Storage Play

The $30 million Adaptec is spending for Eurologic will allow that company to expand its storage product line to include more external storage solutions, said Ahmat Houssein, vice president and general manager of Adaptec.

Adaptec's products are mainly focused on the components that go into building a storage infrastructure, including host-bus adapters and silicon for ATA, Fibre Channel and Serial ATA solutions, said Houssein. The company also offers some small RAID subsystems. Its primary sales focus is on storage OEMs and white-box server builders, he said.

Eurologic, on the other hand, offers a family of storage networking solutions, including a wide range of SCSI, iSCSI and Fibre Channel arrays, plus its Spheras Storage Management suite of software. The company has a strong play with tier-two and some tier-one storage OEMs, Houssein said.

"We wanted to establish our ability to drive external storage solutions," said Houssein. "We believe the growth of external storage will be strong. And the small- and midsize-business spaces will be the next big growth space for external storage."

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The acquisition will also be a chance for the combined company to cut the cost of building Eurologic's products, Houssein said. "Adaptec has components that will help drive Eurologic's cost down and performance up," he said.

More than 30 percent of Adaptec's sales go through the channel, compared with about 20 percent for Eurologic, said Houssein. "Eurologic gives us a credible product set to go to the channel," he said. "But we will still have a predominant OEM focus."

This is not Adaptec's first acquisition. In November, the company purchased NAS technology developer Tricord Systems.

Adaptec shares fell 8 cents to $6.03 on Monday.