Sun Micro Acquires Kealia

The deal marks the reunion of Sun co-founders Andy Bechtolsheim and Scott McNealy.
By K.C. Swanson ,

Sun Microsystems

(SUNW) - Get Report

announced after the close Tuesday it is acquiring

Kealia

, a privately held server-technology company based in Palo Alto, Calif.

The financial value and terms of the deal were not disclosed, though Sun said it will involve a stock swap and is expected to close during the third or fourth quarter of Sun's fiscal year 2004.

Kealia will be incorporated within Sun's volume systems products group.

The head of Kealia, Andy Bechtolsheim, co-founded Sun with current Chief Executive Officer Scott McNealy. Bechtolsheim later served as vice president of technology from 1984 to 1995. Following his return to the company, he will be senior vice president and chief architect for volume systems.

After the bell, Sun shares rose 8 cents, or 1.4%, to $5.62. In regular trading Tuesday, Sun closed up 2 cents, or 0.4%, to $5.54.

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