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EMC to Acquire VMware, Advancing Convergence of Server and Storage Virtualisation

  • 16 December, 2003 16:44

<p>SYDNEY, December 16, 2003 – EMC Corporation, the world leader in information storage and management, today announced that it has signed a definitive agreement to acquire Palo Alto-based VMware, Inc., a rapidly growing, privately held software company and the world leader in Intel-based virtual computing software, in a cash transaction valued at approximately $US635 million. The acquisition is subject to customary closing conditions and regulatory approvals, and is expected to be completed early in the first quarter of 2004.</p>
<p>The acquisition of VMware will play a key role in EMC’s strategy to help customers lower their costs and simplify their operations by deploying virtualisation technologies across their heterogeneous IT infrastructure to create a single pool of available storage and computing resources. This “Virtual Information Infrastructure” will enable organisations to dynamically configure and reconfigure their compute and storage environments with no downtime as their business needs change. EMC expects VMware’s leadership in server virtualisation, together with EMC’s innovation in storage virtualisation, will serve as a strong foundation for next-generation information lifecycle management solutions.</p>
<p>VMware’s technology enables multiple operating systems -- including Microsoft Windows, Linux and NetWare -- to run simultaneously and independently on the same Intel-based server or workstation and dynamically move live applications across systems with no business disruption. These “virtual machines” integrate seamlessly into existing physical infrastructures and management frameworks, allowing users to see resources as if they were dedicated to them, while administrators manage and optimise those resources globally across the enterprise.</p>
<p>Joe Tucci, EMC President and CEO, said, “Customers want help simplifying the management of their IT infrastructures. This is more than a storage challenge. Until now, server and storage virtualisation have existed as disparate entities. Today, EMC is accelerating the convergence of these two worlds.”</p>
<p>“We’ve been working with the talented VMware team for some time now,” Tucci continued, “and we understand why they are considered one of the hottest technology companies anywhere. With the resources and commitment of EMC behind VMware’s leading server virtualisation technologies and the partnerships that help bring these technologies to market, we look forward to a prosperous future together.”</p>
<p>Diane Greene, VMware President and CEO, said, “This combination is a natural fit. Beyond the obvious product synergies, EMC’s leadership in advancing open standards and its relationships with the leading IT players will foster ongoing innovation and industry-wide cooperation. VMware will continue its deep relationships with the world’s leading server and storage vendors, as well as ISVs and systems management providers to jointly develop useful innovation for our customers.”</p>
<p>VMware software is used today by thousands of companies worldwide to consolidate underutilised servers, reduce server-provisioning time from weeks to tens of seconds, dynamically move application workloads across servers and workstations without service interruption, and eliminate downtime for hardware maintenance, deployment, or migration.</p>
<p>Upon completion of the acquisition, EMC expects to take a charge of approximately $US15 to $US20 million in the first quarter of 2004 for the value of VMware’s in-process research and development costs and other integration expenses. Including the aforementioned charges, the transaction is expected to be dilutive in the first quarter of 2004 by $US0.01 per diluted share and is not expected to impact EPS for the full 2004 fiscal year. EMC expects the addition of VMware to be accretive to EPS by $0.01 in fiscal year 2005.</p>
<p>Upon completion of the acquisition, EMC plans to operate VMware as a software subsidiary of EMC, headquartered in Palo Alto and led by Diane Greene, VMware’s current President and CEO. VMware will remain focused on developing, selling and servicing VMware’s products and solutions.</p>
<p>About VMware</p>
<p>VMware is the global leader in virtual infrastructure software for Intel-based systems. The world’s largest companies use VMware solutions to simplify their IT, fully leverage their existing computing investments and respond faster to changing business demands. VMware is based in Palo Alto, California, and conducts business in more than 100 countries worldwide. For more information, visit</p>
<p>About EMC</p>
<p>EMC Corporation is the world leader in products, services and solutions for information storage and management that help organisations extract the maximum value from their information, at the lowest total cost, across every point in the information lifecycle. Information about EMC's products and services can be found at</p>
<p>EMC is a registered trademark of EMC Corporation. Other trademarks are the property of their respective owners.</p>
<p>For further information, please contact:
Emma Rogers
EMC Corporation
Tel: 02 9925 7942
Mob: 0408 237 309
<p>Debbie Sassine/Catherine Smith
Spectrum Communications
Tel: 02 9954 3299
Mob: 0405 735 323
Email: or</p>

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