By Don Clark
EMC Corp. is ending a three-year foray into the kinds of
data-storage services offered by Dropbox Inc. and Box Inc.,
agreeing to sell control of its Syncplicity business to investment
firm Skyview Capital LLC.
Financial terms of the transaction wasn't disclosed. Under the
agreement, EMC would retain an unspecified ownership stake in
Syncplicity, which helps companies sync and share data files both
on-premises and in remote facilities, and would continue to help
sell its offerings.
EMC, best known for selling hardware for storing corporate data,
bought Syncplicity in 2012 for terms that weren't disclosed. The
startup was founded in 2008.
Skyvew Capital, Los Angeles, specializes in helping convert
units of companies into separate businesses. One of the firm's
executives, Jonathan Huberman, will become chief executive of
Syncplicity.
EMC, of Hopkinton, Mass., has been struggling with weak demand
for some of its older storage hardware. Activist shareholder
Elliott Management Corp. last year took a large stake in the
company and began pushing for changes such as spinning off EMC's
majority stake in software maker VMware Inc. No related actions are
expected until at least September under a standstill agreement the
parties announced in January.
An EMC spokesman said Syncplicity had achieved momentum but
required investments in new features to keep up with the trend
toward mobile employees. "This is a step away from EMC's core
infrastructure strength, " he said.
Terri McClure, a senior analyst with consulting and research
firm Enterprise Strategy Associates, said EMC's sales team
specializes in targeting hardware buyers at companies--not people
inside corporate departments who tend to purchase file-sharing
services. As an independent company, Syncplicity would have more
freedom to partner with companies that could be of more help in
selling its services, she said.
"I think there is a good opportunity," Ms. McClure said. "But
it's going to be tough to take on the brand cachet of Box and
Dropbox."
Mr. Huberman, who led data storage company Iomega Corp. before
selling it to EMC in 2008, stressed that Synplicity differed from
Box and Dropbox in allowing customers to store sensitive files on
their own premises as well as in cloud-style data centers
Synplicity operates. Citrix Systems Inc. is the main competition
for such "hybrid" services, he said.
Syncplicity would operate from Santa Clara, Calif., Mr. Huberman
said. The company hasn't disclosed its revenue or headcount, but he
said most existing employees would be offered jobs after the
separation.
Write to Don Clark at don.clark@wsj.com
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