EMC acquires Data General for euro 1.1 Billion

Waltham 10 Aug 99 High-end data storage leader EMC Corp expanded its storage business with a deal to buy Data General for approximately euro 1.1 billion in stock. The sales follows the recent announcements of IBM, who is agresivelly entering the mid-end and high-end storage market.

EMC, which holds a 35 percent share of the $12 billion high-end storage market, said it will lend its considerable distribution and support muscle to leverage Data General's CLARiiON line of mid-range storage systems.

``It's rare in a business career when you can do a single transaction that allows you to significantly enlarge the market opportunities you have and yet not move away from your core competency,'' EMC Chief Executive Michael Ruettgers said.

EMC expects the size of its high-end storage marketplace to increase to $35 billion in 2001. By entering Data General's mid-range market, EMC expects it would add another $14 billion in market opportunity in 2001.

In the fast-growing data storage business, Ruettgers said demand for information storage doubles each year from the world's 2,000 largest companies.

EMC reiterated its plan to grow revenues to $10 billion in 2001, from $3.9 billion in 1998. Ruettgers said the $10 billion target had been from organic growth and the Data General acquisition would increase the figure, but he declined to say by how much.

The deal is expected to be accretive to earnings in 2000 and ``significantly'' accretive in 2001, Ruettgers said.

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