Zacks_Analysts' Blog : NetApp to Acquire Akorri Networks - Analyst Blog

Storage and data management solutions provider NetApp Inc. (NTAP) sealed a definitive agreement to acquire Akorri Networks Inc. in an all-cash deal. The deal value has not yet been disclosed. NetApp expects the deal to be wrapped up by the end of its fourth quarter.

Massachusetts-based Akorri Networks’ flagship BalancePoint software, which is used for capacity analytics, helps to analyze and virtualize data center operations, with a focus on managing and tracking storage capacity. The solutions enable customers to identify performance bottlenecks and improve storage capacity planning to free up time, people, and budget resources required for both physical and cloud environments. BalancePoint software supports virtual machines and networks, as well as storage-area networks (SANs). The latest version of this software provides predictive analysis for proactive management and troubleshooting.

The BalancePoint software will largely complement NetApp’s OnCommand management suite. OnCommand will now be equipped with the performance capacity analytics tool, which will allow NetApp’s customers to analyze fast-growing storage infrastructure.

The ability to accurately predict and manage performance and capacity requirements has been a common obstacle for many customers turning to a virtualized environment. NetApp’s OnCommand software helps to identify and eradicate these obstacles by improving storage and service efficiency through management of shared storage infrastructure.

The storage vertical space has seen a number of acquisitions in the past few months. Ace PC maker Dell Inc. (DELL) acquired enterprise data storage solutions provider Compellent Technologies Inc. (CML) to strengthen the existing level of its storage offerings. EMC Corporation (EMC) has offered a cash tender offer to acquire storage systems vendor Isilon Systems Inc. (ISLN), to capitalize on the business opportunity ramping in the storage space. In September 2010, Hewlett-Packard Company (HPQ) completed the acquisition of 3Par Inc. All these will eventually intensify competition in the storage market.

Though we are positive on the NetApp-Akorri deal as it could help the former gain storage market share, the intensifying competition in the market keeps us on the sidelines.

Currently, NetApp has a short-term Hold recommendation, as indicated by the Zacks #3 Rank.