EMC Corp. is in exclusive talks to buy computer-storage company Isilon for more than $2 billion, The Post has learned.
“The deal will be done this year,” a source close to the situation said.
It’s the latest big deal in the tech world, where few areas are hotter than computer storage.
While the rate of growth in personal computers is leveling off, the volume of data has jumped 50 percent year over year, said Wedbush analyst Roy Kaushik.
EMC is the leader in external storage, with roughly a 20 percent market share. IBM comes in second, with 15 percent, while Hewlett-Packard and NetApp are not far behind, Kaushik said.
Isilon focuses on a niche, “clustered storage,” that EMC also occupies. However, taking Isilon off the market would make it harder for IBM and HP to offer the same service, as neither currently has the capability, Kaushik said.
Clustered storage is important in storing high-definition media applications or in other instances where a huge amount of data needs to be stored.
Still, Isilon has sought a buyer for a while, and some tech giants have passed, another source said. Isilon has reportedly hired Frank Quattrone’s Qatalyst Group to advise it.
Last month, HP won a fierce bidding war for 3PAR, beating out Dell with a $2.35 billion bid. Like 3PAR, Isilon has a niche storage technology.
“This is a poor man’s 3PAR,” the source said.
EMC and Isilon did not return calls. Isilon’s shares rose 1.8 percent yesterday to $27.72, giving it a market cap of $1.78 billion.
Meanwhile, London’s Evening Standard reported this week that Oracle had made a $40 a share bid for EMC.
Besides pursuing Isilon, EMC through its majority owned VMware, is still in exclusive talks to buy Novell’s division that develops and delivers Linux systems, a source said.