DataDirect Networks looks to pick up Tintri at pennies on the dollar

DataDirect Networks, which has been more of a than storage player, makes an storage play by bidding for the distressed assets of , which has always had interesting tech, but which got squeezed in a tight storage market.

DataDirect Networks [], which has been focused on providing Big Data storage to global organizations, has announced that it has entered into a non-binding letter of intent agreement with Tintri, to acquire substantially all its assets, and in so doing, add an enterprise component to their storage business. The terms of the offer were not disclosed.

For Tintri, DDN’s stalking horse bid will mark the end, one way or another, for a vendor which brought a unique VM-aware flash technology to market from the time it first emerged from stealth. It managed at the VM level, rather than LUNs or volumes. The company continued to chug along, never making a big breakthrough, until it went public with its IPO last year. That was a disaster, on several fronts.

“TIntri was already sliding when they IPO’d last year,” said Steven McDowell, storage analyst at Moor Insights and Strategy. “Revenue had stalled and they went out lower than they wanted.” Worse still, they failed to make their numbers in their first quarter as a public company – always a no-no, and something that was practically guaranteed to bring a chill to the market.

Tintri’s own problems compounded an increasingly rugged competitive environment, in which several other major players strengthened themselves, while the flood of newer and shinier startup toys continued to flow into the marketplace.

“The fundamental problem is two-fold,” McDowell said. “Flash storage became mainstream over the past 24 months, and the momentum shifted to the larger OEMs, with acquisitions.  There’s not a lot of room for pure play vendor players in storage.”

Pretty much all of Tintri’s larger competitors strengthened themselves in this period.

“Dell was wildly successful in integrating EMC, and HPE brought Nimble in, which was announced about the time Tintri started their IPO activities,” McDowell said. “Pure Storage stole everyone’s thunder in the performance flash space. Tintri was outmarketed there.  At the same time, NetApp was undergoing a heck of a rejuvenation period, and coming out with really good products with the NetApp pedigree.”

In contrast, McDowell said Tintri was being forced to scramble.

“Given Tintri’s revenue, I’d say they were chasing bad deals to try and keep afloat,” McDowell said.

This week, Tintri made a Chapter 11 bankruptcy filing

Enter DDN. Tintri does have a significant customer base, over 1000 strong, and assuring these customers that their investment is safe and not about to be set adrift is critical. DDN told ChannelBuzz that their bid, filed shortly after the bankruptcy filing, would provide these customers with the stability and continuity for the Tintri products they have installed in their data centers, and provide them with a winning long-term product roadmap. Tintri indicated that it has secured bridge financing to sustain it until the deal with DDN is completed.

“DDN is working with Tintri’s co-founders, team members, advisors and creditors to develop a winning plan designed to provide Tintri’s customers with continuity in support of their installed base as well as a winning roadmap for their long-term requirements,” said Alex Bouzari, DDN CEO and Co-Founder, in a statement. “Tintri’s industry leading all flash scale out and automation enterprise storage solutions have been successfully deployed in more than a thousand companies, including 20 of the Top Fortune 100. They are essential tools to help organizations build agile development environments for cloud native applications and run mission-critical enterprise applications better than ever before.”

The plan is to rebuild a technology company which DDN says has great products, great engineering and great customers – and create many jobs in the process.

“DDN is picking up the pieces for pennies,” McDowell said. “DDN plays in Big Data, not the enterprise, so it’s a a great play for them to acquire some really good technology.”

DDN told ChannelBuzz that they expect Tintri to name it as the Stalking Horse bidder with the court. It is DDN’s belief that its letter of intent maximizes value for Tintri’s creditors while delivering the best and safest path for sustainability and success to its customers, partners and employees.

DDN’s move with Tintri follows up their recent acquisition of Intel’s Lustre file system business and its file system technology.

Related Posts Plugin for WordPress, Blogger...

Leave a Reply

Your email address will not be published. Required fields are marked *