Friday, December 9, 2016

Who could potentially buy Brocade’s Networking Business?

With #Broadcom revealing plans to acquire #Brocade and then divest its networking business, which includes #RuckusWireless, analysts are closely examining who the potential buyer could be. "Frankly, I think people would be surprised at how many interested buyers there are," one source familiar with the situation told CRN USA, who declined to be identified. "Those buyers are a mix of financial sponsors, so private equity companies and also strategic buyers. ... There is a very strong desire from all the parties – Brocade, Broadcom and any potential buyer – a strong desire to move as quickly as possible." In a research note, RBC Capital Markets analyst Mitch Steves said the sale of Brocade's networking business come at a price tag of around US$2.2 billion. Brocade's networking business is at an annual run rate of about US$1 billion, while Brocade purchased Ruckus for US$1.2 billion. CRN USA breaks down the five potential buyers and the five companies that are unlikely to buy the Brocade business, according to analysts. 1. Potential buyer: #Dell Although Dell still has its hands full with its acquisition of #EMC, analysts believe the Texas-based company could gain a competitive edge against #HewlettPackardEnterprise and #Cisco Systems by buying Brocade's networking business. Zeus Kerravala, principal analyst at US-based ZK Research, said Dell's networking sales would get a shot in the arm from Brocade and Ruckus channel partners. "Dell's always talking about competing better with HPE, except for networking. They have a little bit of networking from the old #Force10 acquisition … but Brocade would be a really good addition there," said Kerravala. "There would be some channel reconciliation that would happen, although the Dell channel isn't a great networking channel. … Dell partners sell servers, PCs and storage, but not really networking. Brocade's channel would make a nice complement to what Dell already has."

http://www.crn.com.au/news/who-could-potentially-buy-brocades-networking-business-444089

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