LSI Logic today announced an agreement with IBM Corporation calling for LSI Logic to acquire the assets of IBM's Mylex business unit. LSI Logic will use the purchase method of accounting for the acquisition. The cash transaction is anticipated to close during LSI Logic's third quarter ending September 30 and is expected to be accretive to LSI Logic earnings.
As a result of the transaction, LSI Logic Storage Systems, Inc. and LSI Logic's Storage Components Group will acquire the Mylex business unit's RAID (Redundant Array of Independent Disks) controllers, subsystems, hardware and software technologies. The purchase will strengthen LSI Logic's position in the expanding entry-level storage systems space and the PCI-RAID segment.
LSI Logic will gain the expertise of IBM's Mylex business unit's hardware and software engineers and sales representatives. In addition, the company will also have access to the Mylex sales channels and a customer base that includes IBM, NEC, Fujitsu-Siemens, Xyratex and Eurologic.
"This strategic transaction expands LSI Logic's capabilities in both of our growing SAN systems and storage components businesses," said Wilfred J. Corrigan, LSI Logic chairman and chief executive officer. "We are looking forward to welcoming the Mylex business unit employees to LSI Logic and to serving Mylex customers competing in the SAN systems and storage components sectors."
"High performance modular storage systems are proving to be the most cost effective and flexible solutions to meet growing customer storage needs under tight IT budget constraints," said Tom Georgens, LSI Logic Storage Systems, Inc. president. "This acquisition strengthens our position in this fast growing segment and increases our development capabilities to pursue more customer opportunities."