EMC to buy Israeli virtual storage startup ScaleIO for $200m?

ScaleIO's elastic virtual SAN pitch is reportedly encouraging EMC to get its chequebook out.

EMC is reportedly buying Israeli storage startup ScaleIO for a purchase price thought to be between $200m and $300m.

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The reported buyout first appeared in Israeli business daily Calcalist. While neither company has commented on the report yet, Calcalist quotes sources in both companies as saying a deal is in the offing.

ScaleIO's flagship product, ECS (Elastic Converged Storage), allows users to tie together storage on numerous commodity application servers to make a single virtual SAN.

ScaleIO's ECS elastically aggregates free capacity across a network, with the software managing disks, RAM and network resources to use the free capacity for storage.

ECS is software-based and sits on the application servers as well as hypervisors, databases and other applications, and can scale out to thousands of nodes and use block-level storage as traditional SANs do.

The company's pitch is that by dispensing with the hardware needed for a dedicated SAN and all that goes with it - the staff needed to run it, the electricity for the cooling systems it requires, and the service contracts – businesses can save money on storage.

ScaleIO was established in 2011 by its CEO Boaz Palgi and CTO Erek Webman, and last December (days after emerging from stealth mode, in fact) the company announced that it had raised $12m in funding from venture capital firms Greylock Partners and Norwest Venture Partners. This is EMC's second acquisition in Israel in the past year: in May 2012, the Boston-based company bought Israeli flash storage pioneers ExtremeIO for $430m.

In its report, Calcalist added that EMC's security division RSA had tracked down yet another startup for EMC, and that a deal to buy that company would be announced soon.

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