IBM Said to Be Eyeing Diligent

IBM is in "advanced negotiations" to buy de-duplication specialist Diligent for around $200 million, according to a report in the Israeli media.

The Framingham, Mass.-based startup, which has its R&D facility in Tel Aviv, is currently in M&A discussions with IBM, according to the Globes Website, though neither vendor was forthcoming on this topic when contacted by Byte and Switch earlier today.

"I cannot comment on rumor and speculation," said Melissa Morales, Diligent's director of marketing.

A similar response came from IBM spokeswoman Marissa Benekos, who also declined to comment.

Diligent, which was formerly EMC's Israel R&D lab nonetheless seems to be forging closer links with IBM.Co-founder and board director Moshe Yanai is also executive chairman of Israeli clustering startup XIV, which was bought by IBM for a rumored $350 million earlier this year.

IBM has been relatively quiet on the subject of de-duplication, although there was chatter last year that the vendor was eyeing its VTL partner and de-dupe specialist FalconStor as a possible acquisition target.

Diligent has already clinched reseller deals for its ProtecTier software with Overland, HDS, and Sun, potentially making it an attractive M&A target.

Although traditionally focused on high-end enterprises, Diligent launched a midrange version of ProtecTier last year and is planning to extend its reach into remote offices with the launch of a replication offering later this year.

De-duplication, which eliminates redundant files from backup to save space and time, has been identified as one of the technologies most likely to flourish in the current climate of economic uncertainty, making more M&A and partnership deals likely.EMC, for example, has already spent $165 million on de-dupe specialist Avamar and has an OEM agreement with FalconStor, although sources say that the vendor is looking for another de-dupe partner, possibly Quantum.

Diligent, which was has raised around $47 million in funding since it was spun out of EMC in 2002, is also getting some big-name customer wins. The vendor lists the Union Pacific Railroad, Czech car manufacturer Skoda Auto, and Japanese technology giant Sharp amongst its customers, though it has not yet published any financial figures.

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