Deal Strengthens Company’s Virtualized Data Center Offering
CHANHASSEN, Minn.--(BUSINESS WIRE)--Oct. 6, 2009--
Datalink (Nasdaq: DTLK), a leading provider of data center
infrastructure, solutions and services, today announced that it has
acquired Minneapolis-based Cross Telecom’s networking solutions
organization. This team brings expertise in enterprise data networking,
a key skill set needed when helping organizations virtualize their data
centers.
“This is an exciting opportunity for Datalink to expand the value we
deliver to our customers,” said Paul Lidsky, president and CEO of
Datalink. “Companies continue to move aggressively to consolidate their
server, storage and networking infrastructures. Virtualization
technology is accelerating this trend, and it delivers tremendous
efficiency and productivity gains for customers.”
With the convergence of storage and networking, this new team’s
capabilities will add to Datalink’s expertise in designing, implementing
and managing sophisticated storage, backup and recovery infrastructures.
Historically, Fiber Channel and Ethernet were distinct infrastructures
provided by separate networking vendors. Going forward, Ethernet will
play a central role in consolidated data center networks. By acquiring
the Cross networking solutions team, Datalink is able to help customers
build the consolidated networks they need to support growing their
virtual data center infrastructures.
The team has extensive experience designing, deploying and supporting
reliable, cost-effective and secure LAN, WAN and data center
infrastructure and security solutions for customers ranging from Fortune
100 companies to small businesses. As a result of this acquisition,
Datalink is now a Cisco Silver Certified Partner.
Strengthening Datalink’s Virtualization Practice
In September, Datalink unveiled two new services to help companies more
effectively design IT infrastructures for virtual environments: the
Virtual Infrastructure Audit and the Virtual Infrastructure Assessment.
These services provide an end-to-end view of existing servers,
applications and storage devices. Cross-domain visibility and related
analytics help customers identify current and potential performance
issues, as well as make informed design choices based on Datalink
recommendations.
“By combining data networking capabilities with our existing SAN and
virtualization expertise, we are able to offer customers a single source
for all of their data center virtualization needs. This is significant
as virtualization technologies have grown to become an essential
component for driving efficiency in a company’s IT operation,” said
Lidsky.
Datalink will immediately assume responsibility for supporting the Cross
networking customers. Over the coming weeks, Cross’ sales force will
introduce Datalink to customers who need storage and data center
virtualization. Over time, the company believes this will provide
incremental growth to Datalink.
The transaction closed Oct. 1, 2009, and was structured as an asset
purchase. The purchase price paid at closing was $2 million. Under terms
of the purchase agreement Datalink and Cross entered into a services
agreement under which Cross agreed to purchase at least $1.8 million of
networking products and services from Datalink over the next three
years. Datalink expects the transaction to be slightly accretive to
earnings in the first 12 months.
The company will discuss this acquisition during its third-quarter
earnings conference call being held Wednesday, Oct. 14, 2009, at 4:00
p.m. CT. To access the conference call dial (877) 277-9804. Participants
will be asked to identify the Datalink conference call and provide the
designated identification number (31986470). A live Webcast of the call
can be heard via Datalink’s website at www.datalink.com.
About Datalink
A virtual data center infrastructure, solutions and services provider,
Datalink helps organizations store, manage and protect one of their most
critical assets--information. The company's solutions and services span
four practices: backup and recovery; consolidation and virtualization;
archive and compliance; and business applications. From analysis and
design to implementation, management and support, Datalink is focused on
maximizing the business value of IT. For more information about Datalink
services, contact Datalink at (800) 448-6314, or visit Datalink online
at www.datalink.com.
The Private Securities Litigation Reform Act of 1995 provides a “safe
harbor” for certain forward-looking statements. This press release
contains forward-looking statements which reflect our views regarding
future events and financial performance. These forward-looking
statements are subject to certain risks and uncertainties, including
those identified below, which could cause actual results to differ
materially from historical results or those anticipated. The words “aim,
“believe,” “expect,” “anticipate,” “intend,” “estimate” and other
expressions which indicate future events and trends identify
forward-looking statements. Actual future results and trends may differ
materially from historical results or those anticipated depending upon a
variety of factors, including, but not limited to: the level of
continuing demand for storage, including the effects of current economic
and credit conditions; competition and pricing pressures and timing of
our installations that may adversely affect our revenues and profits;
fixed employment costs that may impact profitability if we suffer
revenue shortfalls; our ability to hire and retain key technical and
sales personnel; our dependence on key suppliers; our ability to adapt
to rapid technological change; risks associated with integrating
possible future acquisitions; fluctuations in our quarterly operating
results; future changes in applicable accounting rules; and volatility
in our stock price. Further, our revenues for any particular quarter are
not necessarily reflected by our backlog of contracted orders, which
also may fluctuate unpredictably.
Source: Datalink
Datalink
Investor Relations:
Kim
Payne, Investor Relations Coordinator
Phone: 952-279-4794
e-mail:
einvestor@datalink.com
or
Analyst
Contact:
Greg Barnum, Vice President and CFO
Phone:
952-944-3462
web site: www.datalink.com
