SAN DIEGO -- Overland Storage, Inc. (Nasdaq: OVRL) today announced that it has acquired the Snap Server NAS business from Adaptec Inc. (Nasdaq: ADPT), including the brand and all assets related to Snap Server networked and desktop storage appliances. The acquisition extends Overlands vision, reach and strategy for delivering end-to-end data protection to its customers and partners with the addition of best-in-class NAS and replication solutions. The net purchase price was $3.6 million, with $2.1 million paid in cash upon closing of the transaction, and the remainder to be paid in 12 months.
The Snap Server product line broadens Overlands capabilities by adding distributed NAS while also strengthening central and remote office data protection. Snap Server leads the NAS market with more than 200,000 units shipped. The acquisition will enable Overland to address the $1.2 billion SMB NAS market, which according to IDC continues to grow by at least 15 percent annually. The features and functions of the Snap Server product line position it well to target the three fastest growing market segments: distributed NAS, centralized data protection for remote sites and backup to disk.
This acquisition enables Overland to provide its customers and partners with much-needed NAS functionality that complements the companys well established REO® disk-based backup VTL, NEO® and ARCvault tape automation products along with ULTAMUS® RAID general-purpose SAN storage. The addition of the Snap Server business is important to Overland in a number of ways. First, it adds a best-in-class distributed NAS offering to the companys product portfolio, helping Overland achieve its goal of providing end-to-end data protection solutions to SMB customers and distributed enterprises. Second, the acquisition immediately adds approximately $18 million in annual revenue to the companys run rate, which should provide Overland with the ability to leverage its existing sales force, marketing resources and infrastructure. Finally, the acquisition contributes a significant amount of proprietary intellectual property (IP), which should strengthen the companys intrinsic value, along with a strong and cohesive development team to promote further growth of the Snap Server product line.
We believe that the cross-pollination of existing Overland IP with the Snap Server IP will yield innovative features and products that will strengthen all our product offerings individually, as well as improve their interoperability, said Vern LoForti, president and CEO of Overland Storage. Snap Servers are pervasive in the marketplace and we intend to leverage this position to continue the Snap tradition of simple, reliable, easy-to-use appliances. We also plan to extend the Snap reach by exploring emerging market segments such as the ever-increasing demands for high-performance, cost-effective, scalable file-based storage to accommodate the rapid rise of video surveillance and video archiving applications. Although the acquisition initially will negatively impact our P&L, our goal is to make the Snap business cash-flow positive by the third quarter of our fiscal year ending June 30, 2009.
Overland Storage Inc.