EMC is expected to announce as early as today that it has reached a deal to buy Isilon, which stores video and digital images, The Post has learned.
In the past few weeks, exclusive talks between EMC and Isilon had gone cold over price, but the two sides were very close to an agreement over the weekend, a person close to the situation said, and barring last-minute complications were set to seal the deal early this week.
Isilon closed Friday at $26.29 a share, giving the firm a $1.75 billion market capitalization. The company’s stock is down about 10 percent since Nov. 4, when the Wall Street Journal reported talks had fizzled.
On Oct. 18, The Post broke the news that EMC and Isilon were in talks.
By buying Isilon, storage leader EMC will essentially lock up clustered storage in cloud computing over the Internet because the pair are the two main providers of that service.
Clustered storage is important in storing high-definition media applications, or in large-scale industrial-use simulation, where a huge amount of data needs to be stored.
Neither company reps returned calls for comment before presstime.
In tech, there are few areas hotter than computer storage. While the rate of growth in personal computers is leveling off, the volume of data is up 50 percent year over year, said Wedbush analyst Kaushik Roy.
Hewlett-Packard in September won a very spirited bidding war for 3PAR over Dell agreeing to pay $2.35 billion. Like 3PAR, Isilon is basically a one-trick cloud pony that has a niche in storage technology.
Isilon’s shares have risen roughly 70 percent since the 3PAR deal was announced on takeover speculation. The seller is using Frank Quattrone’s Qatalyst Group as its banker, the same firm that sold 3PAR.
The company’s revenue in the third quarter was $53.8 million, a 77 percent rise from a year earlier. Still, Isilon is barely profitable.