NEW YORK (
$2.2 billion deal for
( ISLN) sends shares of storage rivals like
down, but potential takeout targets like
( CML) and
jumped on hopes of a bigger buyout boom.
EMC said Monday that it would pay $33.85 a share in cash for Seattle-based Isilon. The deal, including cash on hand, is priced to give Isilon shareholders a 28% premium over the value of the stock when it closed trading Friday.
Betting on a potential bidding war, traders pushed the value of the company up above the price of the deal at one point Monday. In pre-market trading, investors sent Isilon shares up 30% to $34.10, or 25 cents more than the deal price.
Shares of Compellent rose 7.5% and CommVault stock was up 3% in early trading Monday in the wake of the Isilon deal.
Storage has been a hot sector as suppliers seek new solutions to help customers keep up with growing data keeping needs. Market researchers at IDC pegged the
to be running at greater than 20% in the second quarter.
The move by EMC to acquire a network-attached storage or NAS shop, follows similar buyouts in the storage sector including
$2.35 billion acquisition of
. HP prevailed over
in a short bidding battle to buy 3Par in September.
In picking Isilon, EMC passed over No. 3 storage player NetApp, which could signal that NetApp may have to be a buyer rather than a target in the storage race.
--Written by Scott Moritz in New York.>To contact this writer, click here: Scott Moritz, or email: email@example.com.To follow Scott on Twitter, go to http://twitter.com/MoritzDispatch.>To send a tip, email: firstname.lastname@example.org.