EMC is set to acquire cloud computing services firm Virtustream as part of a broader hybrid cloud strategy, enabling the firm to support customers running everything from the smallest applications to the most demanding enterprise applications, whether on or off premise, the company said.
The Virtustream purchase for a cash sum of $1.2bn is still subject to approval, but is expected to close during the third quarter of 2015. Once complete, Virtustream will form EMC's new managed cloud services business.
Virtustream's chief product is the xStream cloud management software, but the firm also uses this to operate cloud infrastructure-as-a-service offerings delivered from its own data centres in the US and Europe.
With the addition of these assets to the EMC Federation family, the firm believes it will have the industry's most comprehensive hybrid cloud portfolio.
EMC chief executive Joe Tucci hailed the impending deal as a "transformative acquisition for EMC" and a critical move in one of the IT industry's fastest-growing and most important sectors.
"With Virtustream in place, EMC will be uniquely positioned as a single source for our customers' entire hybrid cloud infrastructure and service needs. We could not be more delighted that Virtustream will be joining the EMC Federation family. It's a game changer," he said.
The EMC Federation already comprises cloud firms VMware and Pivotal, and EMC is pitching the acquisition as rounding out the assets it already owns into a comprehensive portfolio, with EMC providing the Federation Enterprise Hybrid Cloud Solution for private clouds, and VMware providing the public cloud services part of the puzzle through vCloud Air.
Under this vision, Virtustream brings a managed cloud software and services capability to the EMC portfolio that will enable customers to move their entire application portfolio into a cloud environment.
Writing on the Virtustream blog, chief executive Rodney Rogers disclosed that his firm had been planning to go public, but opted instead to accept EMC's overtures.
"We believe that we help fulfil the EMC vision of being able to run any type of enterprise application in the cloud, anywhere in the world, through ultimately whatever method of consumption makes sense for the customer," he said.
"EMC's reach, sales force, commercial model and asset base will literally give us the opportunity to take this precious kernel of IP that we have developed and reach the world with it."
Meanwhile, VMware's cloud services chief Bill Fathers gave his upbeat assessment of the move, writing on the firm's blog that there are already synergies, as Virtustream is a long-standing member of VMware's vCloud Air Network of partners and is a VMware customer.
"Over the coming weeks and months, we will be working on how we jointly market and sell this new capability. Once the deal closes, we'll update you further with details on how to take advantage of this new offering," he said.
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