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[QUOTE]Originally posted by atleast: [QB] Exabyte sold for $28 million By Jeff Smith, Rocky Mountain News August 30, 2006 Boulder’s Exabyte Corp., a struggling data storage company once described as the hottest high-tech company in northern Colorado, announced an agreement Wednesday to sell its assets to Tandberg Data ASA of Norway for $28 million. The sale marks still another loss of a Colorado-based tech company. It comes on the heels of the sale of McData Corp., the last major player in the state’s celebrated data-storage industry. McData was sold to Brocade Communications Systems Inc. for $713 million. Kelly Beavers, an Exabyte co-founder and vice president of product marketing, said the current plan is for Tandberg to retain the north Boulder operation and offer jobs to Exabyte employees. Exabyte employs 170 worldwide, nearly 150 of whom are in Boulder. The deal required Exabyte to restructure its debt agreements and for Tandberg to assume many liabilities. But Exabyte stockholders stand to lose everything. Exabyte shares, traded on the over-the-counter bulletin board, dropped 75 percent to 3.5 cents Wednesday after the deal was announced. Exabyte, co-founded in 1985 by former StorageTek executive and co-founder Juan Rodriguez, once was considered a dominant tape drive maker. But Exabyte started to fall on hard times in the late 1990s. Rodriguez, formerly chairman, went off the board several months ago although he is still listed as the company’s chief technologist. "Spiritually, I think it’s been a pretty tough road for Exabyte," said Robert Amatruda, an analyst for the research group IDC. He noted that it’s difficult for people to "watch a homegrown company get snapped up, especially by a foreign entity." But Amatruda said Exabyte found itself in an industry dominated by a few, larger companies. "It wasn’t indicative of their products, which were very well-designed." He said he believes Exabyte management did everything it could in recent years to increase revenue and win new customers, "but the world of tape transitions happens slow." He said the deal gives Tandberg a "well-respected brand in the storage industry" and a U.S.-based distribution channel. "I’m sure there will be ‘efficiencies,’ but at the end of the day, they want to grow their North American business," Amatruda said of the prospect of Tandberg retaining Exabyte employees. Exabyte generated $21.6 million of revenues in its first quarter of 2006, while Tandberg Data had $30.5 million of revenues. Beavers said most liabilities are being settled or assumed by Tandberg, with a "minor amount" still outstanding. But he added there is the possibility of continued negotiations. Exabyte plans to liquidate its operations immediately after the transaction closes, though it’s possible some creditors may decide to litigate the issue. Most investors already had given up on Exabyte. Even before the deal was announced, the stock had declined to less than 15 cents a share. Beavers said employees were informed of the sale Wednesday morning, but it was still early to assess the mood. He said he believes the sale could make customers more comfortable buying Exabyte tape backup systems, which typically are used by small to medium businesses. "I think resellers should find more confidence (now)," he said. "It’s more of a future than we had." [/QB][/QUOTE]
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