IBM Acquires Diligent for $168 Million

Israel's The Marker and Globes Online are reporting this morning that IBM has made it official that it is acquiring Diligent Technologies. Though the two sources differ as to the terms of the deal (Globes Online reports $200 million while The Marker reports $168 million), my sources in Israel's IT community tell me that the $168 million number is the more accurate of the two numbers. Under the terms of the deal, IBM will pay $160 million for Diligent's intellectual property while the balance would be used to keep some of the existing employees onboard.

The big question that lurks with this acquisition is where does this leave HDS now that it appears the IBM/Diligent deal is complete? HDS (Hitachi Data Systems) has been reselling Diligent Technologies ProtecTIER for the last few years into enterprises. In the last few quarters, HDS has produced some real results with Diligent landing some large customers. Now that the IBM acquisition of Diligent Technology appears to be all but a done deal, where does that leave HDS and their customers as HDS is now left without a viable de-duplication technology in one of the hottest sectors in data storage? Some good dialog and speculation about HDS's general lack of action appeared last month on Storagezilla's web site though one has to wonder just how practical HDS's continued strategy to miss out on M&A deals like this one really is going forward.