Updated from 4:54 p.m. EDT
has thrown down $1.5 billion to acquire publicly traded backup specialist
Under the terms of the deal, NetApp will acquire all of the outstanding shares of Data Domain's common stock for $25 per share in cash and stock.
"This combination is a great opportunity for both NetApp and Data Domain," said NetApp CEO Dan Warmenhoven in a statement. "NetApp has the distribution channels and international reach to offer Data Domain products to more customers, accelerating growth and market adoption."
Data Domain is seen as key developer of
(subscription required) technology, which ensure that identical pieces of data are not stored. The Santa Clara, Calif.-based company went
in 2007 and generated revenue of $79 million in its recent first quarter.
News of the deal pushed Data Domain's shares up $6.34, or 35.7%, to $24.30, in extended trading Wednesday. NetApp's stock, however, dipped 45 cents, or 2.66%, to $16.89.
NetApp, which competes with
, released its fourth-quarter results after the market closed.
The Sunnyvale, Calif.-based firm reported revenue of $880 million, down from $938 million in the same period last year, but above analysts' estimate of $856.48 million.
NetApp earned 23 cents a share on net income of $75 million, compared to 26 cents a share and $90 million in the year-ago quarter. Excluding charges, the company posted earnings of 31 cents a share on net income of $103 million, compared to 38 cents a share and $131 million in the year-ago quarter. Analysts had expected earnings of 23 cents a share.
NetApp did not give revenue guidance for the fourth quarter, but expects a non-GAAP gross margin of 61%.
The storage giant expects the Data Domain deal to close in the next 60 to 100 days, and says that it will be accretive on a non-GAAP basis within the subsequent 12 months.