Monday, November 5, 2007

Did EMC Drop Out of the Bidding for EqualLogic?

Dell is paying $1.4 billion in cash for Nashua, NH-based EqualLogic. Company is run by Lotus alum Don Bulens, and backed by Charles River Ventures, Sigma Partners, Focus Ventures, and TD Capital. This is a big exit for all involved, since only about $52 million had been invested in EqualLogic. (Earlier this year, Bulens had touted the company as an IPO prospect.)

I had lunch today with a storage industry entrepreneur who suggested that EMC had likely been in the bidding, but dropped out before the price reached $1.4 billion. He also speculated that this could mean the end of EMC's partnership with Dell; Dell's reseller arrangement with EMC accounts for about 16 percent of EMC's storage revenue. The official word from EMC is that there will be no changes to the Dell partnerhship.

Goldman Sachs just downgraded EMC from a "Buy" to "Neutral."

EMC chief executive Joe Tucci gave this interview in October in which he vowed to catch up to the competition by early 2008. Which is coming soon.

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