WANdisco Plc Acquisition of AltoStor (3890R)

TIDMWAND

RNS Number : 3890R

WANdisco Plc

19 November 2012

19 November 2012

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION

WANdisco plc

("WANdisco" or the "Company")

Acquisition of AltoStor

- WANdisco completes acquisition of pioneering Big Data company -

- Acquisition will accelerate WANdisco's product development efforts in the fast-growing Big Data market -

- AltoStor brings two founding developers of Apache Hadoop technology to the WANdisco team -

Sheffield, UK & Palo Alto, CA - WANdisco (LSE: WAND), a leading provider of global collaboration software to the software development industry, is pleased to announce it has completed the acquisition of Silicon Valley based software company, AltoStor. WANdisco believes this acquisition will enhance and accelerate its ability to develop new products for the Big Data market, which the Directors believe represents a significant, long-term growth opportunity for the Company.

Acquisition Key Points

The Directors believe that AltoStor will:

-- Fit well with WANdisco's stated strategy to develop new products targeting the fast-growing Big Data market

-- Accelerate WANdisco's Big Data efforts by adding highly relevant IP and skills to WANdisco's current IP base

-- Deliver unparalleled Big Data expertise to WANdisco in the shape of AltoStor's founders who were two of the founding developers of Apache Hadoop

-- Enable WANdisco to launch ahead of plan its first Enterprise ready Big Data product to market in H1 2013

WANdisco, AltoStor and Big Data

AltoStor is a small, pioneering firm with a deep expertise in the Big Data market. Its founders, Dr. Konstantin Shvachko and Jagane Sundar are among the core Apache Hadoop (Hadoop) creators, developers and on-going contributors.

Hadoop is a proven open source Big Data technology which is the backbone of many of the world's largest and most important databases utilised by companies such as Yahoo, Facebook, Netflix, Amazon and eBay. According to the analyst firm Wikibon, the market for solutions able to solve Big Data issues is forecast to grow 58% between 2012 and 2017 and from $5 billion to over $50 billion in the same timeframe.

WANdisco believes there is a significant growth opportunity for the Company in the Big Data market by applying WANdisco's patented 'active-active replication' technology that is currently being deployed to enable faster, more efficient software development. Applying this technology to the Big Data market it will be possible to minimise data loss and deliver zero downtime to enterprises operating large, mission-critical databases.

Today's acquisition of AltoStor will accelerate WANdisco's pursuit of this opportunity in a number of ways.

First, WANdisco will be able to capitalise on the advanced product development efforts already being undertaken by AltoStor by speeding up the launch of its own Big Data products. The Director's believe that the combination of this work with WANdisco's own development will enable the Company to launch its first Enterprise Big Data product in H1 2013, ahead of the Company's original expectations.

The Directors also believe that WANdisco's targeting of the Big Data market will be enhanced by the addition of AltoStor's founders to the Company's employee base. Dr. Shvachko and Mr. Sundar have unparalleled expertise in Big Data, and specifically Hadoop, which they helped create as part of a twelve-strong team at Yahoo. More recently, Dr. Shvachko implemented Hadoop at eBay where he was the Principal Big Data Architect. Both Dr. Shvachko and Mr Sundar will join WANdisco as part of the acquisition and play a leading role in the Company's Big Data product roll-out. Mr. Sundar will join as Chief Technology Officer & Vice President of Engineering for Big Data and Mr. Shvachko as the Chief Architect of Big Data.

Consideration

Under the terms of the acquisition, WANdisco has purchased 100 per cent of the equity of AltoStor for a total consideration of $5.1 million, of which $3.6 million will be satisfied via the issue of 525,911 new WANdisco ordinary shares (equating to 2.47 per cent of the enlarged issued share capital). Of the 525,911 consideration shares, 37,565 shares will be issued on completion without restrictions on their sale with the balance of 488,346 shares subject to clawback over a three year period under which shares are clawed back if a founder ceases to provide continual service to WANdisco for three years. The number of shares clawed back depends on when continual service ceases. All shares fully vest after this three year period. There are provisions in the agreement to ensure an orderly market is maintained in the event that the founders wish to dispose of their shares as and when they become entitled to do so. In addition to the above the founders will also receive $1.5m in cash, payable on completion as a signing bonus.

The new Ordinary Shares will rank equally with the existing Ordinary Shares in the Company. Application has been made to the London Stock Exchange plc for these Ordinary Shares to be admitted to trading on AIM, which is anticipated to commence on 22 November 2012.

In conformity with Disclosure and Transparency Rule 5.6.1, the Company notifies the market of the following:

As at 19 November 2012, the Company's issued share capital consists of 21,329,071 ordinary shares of 10p each, each with voting rights attached (one per ordinary share) ("Ordinary Shares"). The Company does not hold any Ordinary Shares in treasury.

Therefore, the total number of Ordinary Shares in the Company with voting rights is 21,329,071.

The above figure of 21,329,071 Ordinary Shares may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or changes to their interest in, the share capital of the Company under the FSA's Disclosure and Transparency Rules.

Commenting on the acquisition, David Richards, WANdisco Chairman and Chief Executive Officer, said:

"The AltoStor acquisition will enable WANdisco to launch products quickly into the highly lucrative Big Data market. Combining our technology with the founders of the Hadoop project is a significant coup and an important aspect of this deal is that the founders of AltoStor believe in the WANdisco story - that's why they are committing to this direction for the long term."

Commenting on the acquisition, Jagane Sundar and Dr. Konstantin Shvachko, co-founders of AltoStor, said:

"Prior to this acquisition we had a number of options including venture capital and acquisition approaches from several large Silicon Valley software companies wishing to enhance their Big Data products. When we first spoke with WANdisco we recognized immediately that WANdisco's patented replication technology, combined with AltoStor's products and knowledge could create a compelling product offering that virtually every enterprise looking to deploy Hadoop could utilize."

For further information please contact:

 
 WANdisco plc: 
 David Richards, Chairman and Chief       via FTI Consulting 
  Executive Officer 
 Nick Parker, Chief Financial Officer 
 
 FTI Consulting:                          [phone] 
 Matt Dixon / Sophie McMillan / Jon 
  Snowball 
 
 Panmure Gordon & Co.                     [phone] 
 Fred Walsh / Giles Stewart (Corporate 
  Finance) 
 Adam Pollock, Charles Leigh-Pemberton 
  (Corporate Broking) 
 

About WANdisco

WANdisco (LSE: WAND) is a leading provider of enterprise high availability software. Fortune Global 1000 companies such as AT&T, Intel, Honda, Nokia, Juniper Networks and Motorola rely on WANdisco's high availability solutions for enterprise-class performance, scalability and 24-by-7 availability. A recent Forrester Total Economic Impact (TEI) study of WANdisco's technology revealed a 167 per cent return on investment resulting in a nine-month payback period, please visit us at: http://www.wandisco.com.

Subversion and the Subversion logo are trademarks of the Apache Software Foundation. All product and company names herein may be trademarks of their registered owners.

This announcement is for information purposes only and is not intended to and does not constitute, or form part of, any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities of the Company in any jurisdiction in which such an offer or solicitation is unlawful and should not be relied upon in connection with any decision to subscribe for or acquire any such securities. In particular, this announcement does not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in the United States.

Any securities issued in connection with the acquisition of AltoStor have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act") and may not be offered, sold, taken up or renounced in the United States absent registration under the Securities Act or an applicable exemption from such registration. There will be no public offering of securities in the United States.

This announcement has been issued by, and is the sole responsibility of, the Company. No person has been authorised to give any information or to make any representations other than those contained in this announcement and, if given, or made, such information or representations must not be relied on as having been authorised by the Company or Panmure Gordon & Co.

Panmure Gordon & Co, which is authorised and regulated in the United Kingdom by the Financial Services Authority is acting as Nominated Adviser to the Company for the purposes of the AIM Rules for Companies and is not acting for, and will not be responsible to, any person other than the Company for providing the protections afforded to customers of Panmure Gordon & Co or for advising any other person on any transaction or arrangement referred to in this announcement.

Ends

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