EMC says its bid for Data Domain is superior
Joe Tucci, EMC's CEO, said in a release: "EMC's all-cash tender offer remains superior to NetApp's proposed part-stock merger transaction. We are proceeding with our superior cash tender offer, which is not subject to any financing or due diligence contingency. We do not believe that the Data Domain stockholders will approve the merger transaction with NetApp."
NetApp, one of the top makers of data storage equipment, said its cash-and-stock offer is worth $1.9 billion, net of cash and subject to adjustments. NetApp first made an offer for Data Domain on May 20.
The increased bid came just days after EMC, the world's biggest maker of corporate data storage equipment, sought to top NetApp with its own bid it said was worth $1.8 billion net of cash.
Bidding wars are rare in the technology industry. Even when Oracle Corp. unexpectedly inked a deal to buy Sun Microsystems Inc. in April, there was no counterbid from rival IBM, which had been negotiating for weeks to buy Sun.
It was not immediately clear why the two companies provided different calculations for the total value of their $30-per-share offers.
Data Domain is a leader in data deduplication technology, which helps get rid of redundant data that consumes space in computers. It is one of the fastest-growing segments in storage.
NetApp and EMC also sell data deduplication technology, though they earn the bulk of their revenues from traditional data storage equipment without those features.
Analysts have said EMC might be able to squeeze more value out of Data Domain because it has a larger sales network to distribute the new technology.
In a statement, NetApp chief executive Dan Warmenhoven questioned that logic.
"The complementary nature of the Data Domain and NetApp product lines will result in higher aggregate growth compared to the redundancies that would result with the EMC product line," he said.
(By D.C. Denison, Globe staff, and wire reports.)