HP to buy StorageApps for $350m-stock

Peter Henderson

SAN FRANCISCO: Hewlett-Packard Co. on Wednesday said it would acquire

computer storage software developer StorageApps Inc. in exchange for stock worth

$350 million to improve its network management tools.

StorageApps' management software aims to control hardware from diverse

manufacturers and multiple machines, "virtualising" storage networks

into a single, easy-to-handle system. That is becoming an increasingly important

element for many companies whose storage networks are growing extremely quickly

as they move more and more business functions online.

"The storage virtualization and storage management, which really allow

customers to add terabytes of data as easily as one would have added, maybe 10

megabytes 10 years ago," Nora Denzel, HP's head of storage, said in a

telephone interview. She said she had not seen demand for storage decline

recently, despite the economic environment.

Hewlett-Packard is adapting its popular network management software,

OpenView, for storage networks as well, and expects StorageApps products to

dovetail with that. "It really gives the customers the ability to mix and

match storage hardware," Denzel said.

"We really think storage is headed to a completely networked

environment, in that you take storage devices from many different vendors and

link them together, and you pool them, and they look like one big device,"

she said.

Both companies declined to comment on the revenue of StorageApps, which is a

private company with investors including Dell Computer Corp. and storage

networking hardware firm, Brocade Communications Systems Inc.

Ballooning storage needs made the sector one of the best performing in

technology until the global economic malaise spread there as well, causing

analysts to slash financial forecasts. EMC Corp. has been the clearest victim,

declining after its most recent earnings to forecast precisely the current

quarter.

But StorageApps competitor Veritas Software Corp. still expects substantial

growth, though lower than it did previously, reflecting higher hopes for

software makers. Bridgewater, New Jersey-based StorageApps will become part of

the storage division of Palo Alto, California-based computer and printer maker

Hewlett-Packard, HP said in a statement.

(C) Reuters Limited 2001.