Monday, August 7, 2006

Brocade to Acquire McDATA Corp for $713 Million

Brocade Communications Systems agreed to acquire McDATA Corporation, a leading provider of storage networking solutions. Brocade, which offers a family of Storage Area Network (SAN) connectivity platforms, said the acquisition accelerates the pace of change in next generation data centers.

"The acquisition of McDATA will build on Brocade's vision for the next generation data center, leveraging Brocade's product innovation and operational discipline. The combined company will accelerate innovation and the delivery of a diverse set of compelling and cost-effective solutions to customers, while preserving investment protection, simplifying administration and management, and delivering greater interoperability. These capabilities will enable us to compete more effectively and address the challenges and opportunities for significant growth in a dynamic and changing market," said Michael Klayko, Brocade CEO.

Under the deal, McDATA stockholders will receive 0.75 shares of Brocade common stock for each share of McDATA class A common stock and each share of McDATA class B common stock they hold. Based on Brocade's closing stock price on August 7, 2006, the transaction is valued at approximately $4.61 per McDATA share, or approximately $713 million.

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