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ModernGigabyte

Sun Microsystems To Acquire Parallels For $ 205 Million (Updated)

April 1, 2008 by Robin Wauters 23 Comments

Looks like that Parallels IPO won’t be happening after all. Sun Microsystems has today announced it has reached an agreement to acquire Parallels (formerly SWsoft) and all of its assets for a whopping $ 205 million. The major acquisition had been rumoured to be imminent throughout the course of 2007, but never actually went through, which led mosts analysts to believe the Herndon, VA-based company was heading towards an IPO following in VMware’s footsteps rather than being picked up by one of the big boys.

Needless to say, the acquisition is a pretty bold one, which is bound to serve as wake-up call for the entire virtualization industry. Both companies had been on a buying spree the past few months: Sun picked up innotek / VirtualBox, while Parallels recently acknowledged its January acquisition of ModernGigabyte. The acquisition is expected to be finalized by June, around the time Sun also plans to ship xVM Server.

“With the acquisition of Parallels, Sun’s ready to become the only true leader in virtualization technology,” said Brian Sutphin, Executive Vice President Corporate Development & Alliances for Sun Microsystems. “With Parallels’ strong desktop position, we will be able to cater both Windows/Linux and Mac users with our state-of-the-art virtualization offering.”

Sergei Beloussov, Board Chairman and CEO of Parallels, added:”We’re extremely excited about the opportunities this merger will bring for our many customers and partners. We’re looking forward to effectively integrating our server product line with Sun’s sparc systems.”

Parallels, former SWsoft, has been making waves ever since it was founded in 1999. The virtualization technology company today counts more than 900 employees worldwide and has more than doubled revenues every year for the past eight years, while its products have been giving VMware a run for its money, especially in the small- and medium-business marketplace. The company was backed in 2005 by Intel Capital, Bessemer Venture Partners, and Insight Venture Partners.

While VMware has been more than struggling to consolidate its splashing entry on the public market, Parallels has effectively become the second largest virtualization seller, with both containers and hypervisor plays in its portfolio. Sun’s bold move is logical in this regard, be it quite late, as this acquisition would have made more sense if it had happened around this time last year.

We’re still scrambling to get some official comments on the news from market insiders, we’ll update this post as they come in!

Update: obviously, this was an April Fool (we’re in based in Europe, so it’s April 1 earlier than over in the US).

On any other day, what would you think about this announcement? Would it have surprised you that much? Do you think it would be a fair valuation and a good synergy? Let us know in comments!

(also: check some classic April Fools’ Day jokes here)

Update 2: kudos to Parallels for their sense of humour, thanks to Brian, Dan and Tarry for linking and to the person who dugg the story 😉

Update 3: check out our follow-up post

Filed Under: Acquisitions, Featured, News Tagged With: acquisition, Featured, innotek, ModernGigabyte, Parallels, sun, sun microsystems, swsoft, VirtualBox, virtualisation, virtualization, vmware

Keep It Quiet, But Parallels Acquired ModernGigabyte

March 26, 2008 by Robin Wauters 1 Comment

The Register sure has some pretty observant readers. Apparently one of them noticed an early preview of a deal which has been forged two months ago but was only to be announced tomorrow: Parallels acquired ModernGigabyte, the makers of billing software ModernBill and other automation solutions for the hosting provider market.

virtualization-moderngigabyte-modernbill.jpg

From the website section about the deal, which is supposed to be shared with the press starting tomorrow:

 

What is Parallels announcing?

Parallels is announcing the acquisition of ModernGigabyte, the creators of the ModernBill automated billing system.

 

What is Parallels acquiring?

Parallels is acquiring all of the assets of ModernGigabyte, including its products, services, intellectual property, and its existing staff. ModernGigabyte products include:

  • ModernBill, a billing system for hosting and service providers
  • ModernAuthorize, a real-time payment and credit card processing service
  • SSL Factory, an automated delivery system for SSL cetificates
  • ModernDNS, an automated domain registration service
  • FraudGuardian, a real-time fraud checking service for online ordering

Why did Parallels acquire ModernGigabyte?

Parallels believes that customers will benefit from this acquisition. ModernBill is already integrated with many of the Parallels family of hosting products and now small hosting providers will be able to purchase both control panels and a billing solution from the same company.

Dedicated hosting providers can offer ModernBill along with Plesk to create a complete reseller package.

Parallels ISV partners which have adopted the Application Packaging Standard (APS) will benefit by having a ready to deliver solution for hosting companies to sell their products.

Financial terms of the acquisition were not disclosed, and the deal between the two private firms was actually approved by both companies on January 11 of this year. Note that Parallels plans to maintain the current prices on the ModernBill website.

 

 

Filed Under: Acquisitions, News Tagged With: FraudGuardian, ModernAuthorize, ModernBill, ModernDNS, ModernGigabyte, Parallels, Parallels Virtuozzo, Parallels Virtuozzo Containers, SSL Factory, swsoft, virtualisation, virtualization, Virtuozzo

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