HPE buys Israeli cloud data co Zerto for $374m
Hewlett Packard Enterprise today announced that it has entered into a definitive agreement to acquire Israeli cloud data management and protection company Zerto for $374 million cash, Trend reports with reference to Globes.
With offices in Herzliya and Boston, Zerto’s continuous data protection technology includes disaster recovery, backup, and data mobility in a single, simple cloud data management and protection software solution that spans on-premises, hybrid, and multi-cloud environments.
Zerto assists customers in swiftly recovering from ransomware, cyberattacks, and other unplanned downtime bringing data back to its original state just seconds before the attack or disruption. Zerto also easily replicates and migrates data between VMware vSphere and Microsoft Hyper-V environments and natively to Amazon Web Services and Microsoft Azure.
Zerto has 500 employees serving more than 9,000 customers, including enterprises and 350 managed service providers. According to LinkedIn, the company had 800 employees in 2019 but there have been major layoffs in recent years, with operations closed down in the Asia Pacific region.
Founded in 2009 by CEO Ziv Kedem and his brother CTO Oded Kedem, the company raised $33 million last June from Access Industries via Claltech, 83North, Battery Ventures, Harmony Partners, IVP, RTP Ventures, U.S. Venture Partners and Poalim Capital Markets. According to PitchBook, Zerto has raised $228 million since it was founded and the valuation at last June's financing round was $410 million, so that investors who entered in that round have lost money.
Zerto was spoken of in the past as a company headed for an IPO at a valuation of $600-700 million, and as one of the largest and fastest growing technology companies in Israel. Zerto explained the downsizing as arising from a desire to keep the company strong over time.
Kedem said, "The HPE GreenLake edge-to-cloud strategy and strong leadership is a perfect match for Zerto. Coupling Zerto’s industry-leading cloud data management and protection software platform with HPE’s cloud data services and go-to-market reach will offer an unparalleled experience for our collective customers and partners."
HPE president and CEO Antonio Neri said, "Data is now the most critical asset. With the explosive growth of data at the edge and across hybrid environments, organizations today face significant complexity in managing and protecting their data. Zerto’s market-leading cloud data management and protection software expands HPE GreenLake cloud data services, allowing customers to protect their data and rapidly act on insights, from edge to cloud."
The transaction is expected to contribute to HPE more than $130 million in run-rate revenue at software gross margins.
Zerto’s management team will join the HPE following the close of the transaction, which is expected to occur in the fourth quarter of HPE’s fiscal year 2021.
HPE was spun off from HP in 2015. It provides datacenter products and services to the enterprise market. It is traded on the New York Stock Exchange with a market cap of some $19 billion.