VA Linux boosts hardware and storage portfolio

VA Linux Systems has signed definitive agreements to buy two Californian hardware suppliers - TruSolutions and NetAttach - in cash and stock transactions valued at more than $220m.

The move follows the Linux based systems and services supplier's move to buy Andover.net for $1.04bn last month to boost open source content on its Linux related website.

The aim of its new purchases, however, is to boost its presence in the internet related infrastructure server and storage markets.

Larry Augustin, VA Linux's president and chief executive, said: "These acquisitions will help us to better meet the demands of our customers for complete competitive solutions to their internet infrastructure needs - systems, software, services and the web."

The company has agreed to buy TruSolutions, which sells Intel based, high density, rack-mounted servers, in a combination of stock and cash for about $200m. All of TruSolutions' outstanding stock will be exchanged for approximately 1.8 million newly issued VA Linux shares based on yesterday's closing price of $102.25. TruSolutions' shareholders will also receive $10m in cash.

VA Linux plans to buy NetAttach for $10m in cash and all of NetAttach's outstanding stock will be swapped for 286,000 newly issued VA Linux shares based on yesterday's closing price.

NetAttach sells network attached storage (Nas) devices, and other storage systems aimed specifically at Linux systems. VA Linux expects to start shipping Nas products by the fourth quarter of this year.

The two transactions are expected to close within 30 days and will be accounted for as a purchase.