January 2nd, 2013 by Lyle Smith
Imation Acquires Nexsan Corporation
Imation Corp, a scalable storage and data security company, has announced that it has acquired privately held California-based Nexsan Corporation, provider of disk-based storage systems. Imation plans to build a platform for long-term growth and to improve operating margins in high-growth data storage and security solutions markets.
With the acquisition of Nexsan, Imation gains a proven technology platform that has a healthy portfolio of disk-based and hybrid disk-and-solid-state storage systems. Nexsan also has more than 11,000 existing customers across the globe. Additionally, significant growth in the small and medium-sized business (SMB) as well as distributed enterprise (SME) storage markets is expected. On the flip side, Imation will provide Nexsan with global scale and a well-known storage brand for global expansion. The combined Imation and Nexsan portfolio will provide a solution to SMBs and SMEs who are struggling with the rapid growth of data storage and management needs and will offer customers an attractive, price / performance alternative to competitive offerings.
As for the deal itself, the combination cash-and-stock transaction included roughly $105 million in cash and 3,319,324 Imation common shares, which is the equivalent of approximately $15 million. Nexsan’s revenues in 2011 were $82 million and are continuing to grow, with gross margins in the range of 40 percent. This acquisition is expected to be immediately accretive to Imation’s EBITDA.
Approximately 200 employees located throughout the U.S., U.K. and Canada have joined Imation with this acquisition. Nexsan will continue to operate within Imation from their current headquarters located in Thousand Oaks, California, and under its existing management. Integration and global expansion activities between Imation’s Tiered Storage and Security Solutions business and Nexsan will be announced some time in the first quarter of 2013.