ExaGrid on acquisition path, claims some of its rivals ‘on life support’

Backup appliance vendor ExaGrid recently reported a very positive third quarter, described by the firm as the best in its history. President and CEO Bill Andrews has since elaborated on the company’s financials, and claims a number of its rival firms are “on life support.”

Speaking at the recent IT Press Tour at the company’s headquarters in Marlborough, Massachusetts, Andrews said the backup storage market was currently worth $6 billion a year, and claimed that ExaGrid had 3 percent of it.

That equates to $180 million in sales for ExaGrid, with Andrews maintaining that the company was making solid progress toward achieving $1 billion in annual sales. This represents nearly a fifth of its target.

For its third quarter, the company did not reveal the sales figures for those three months since it’s a privately held firm. But Andrews decided to put down that 3 percent marker for the digestion of the wider backup industry on the IT Press Tour, where he also reported the company was currently growing at 15 percent a year, “with a lot of headroom for further growth.”

He added that the company has free cash flow and was profit and loss positive, saying: “We’re very cash positive, one of our directors even said that we were ‘vomiting cash’ and it’s more than we know what to do with. I cannot think when we will never be cash positive.”

Bill Andrews, ExaGrid
Bill Andrews presenting at IT Press Tour

Andrews was asked about acquisitions. “We have been and are looking at potential foreign acquisitions, but haven’t seen anything we like. I’m always looking.”

He added: “We don’t want to become a conglomerate, we want to acquire something that is synergistic. We want to stay in backup storage, and that’s it.

“There are so many companies for sale at the moment, you wouldn’t believe how many are on life support right now. Our chance of buying something is currently 0 percent to higher, we’ll see.”

Andrews was asked what he thought the value of ExaGrid was, but he declined to proffer a figure, only saying: “We think we can build a bigger company that’s for sure.”