Friday, April 18, 2008

Storage firm Diligent bought by IBM

IBM Corp. has acquired storage software maker Diligent Technologies Corp., the second local storage acquisition by Big Blue in a week.

Framingham-based Diligent would become part of the IBM System Storage unit, officials said.

Last week, IBM reported reaching an agreement to acquire Newton-based FilesX Inc. for an undisclosed amount. FilesX, which was founded in 2000, will be integrated into IBM's Software Group as a part of its Tivoli division.

Diligent Technologies, which develops enterprise disk-based data protection software, has attracted at least $46.5 million in investment capital since it was founded in 2002. The company was co-founded by CEO Doron Kempel with Moshe Yanai, former vice president of the engineering symmetrix group at EMC Corp. That group had been cited as the one behind the core technology that fueled the Hopkinton-based storage company's growth.

Kempel and Yanai left EMC in 2001 to start Diligent, which was formerly EMC's Israel-based research and development laboratory before EMC spun it out for $5 million and took a stake in the new startup.

IBM said that Diligent's 40 local employees would remain in Framingham, at least for the time being. The company also has about 60 employees in Israel and other areas of the United States, all of whom will become IBM employees, officials said. Financial terms of the Diligent acquisition were not disclosed.

Diligent investors included Matrix Partners LP, which operates an office in Waltham, The Credo Group LLC, a venture capital fund founded by Yanai, Accel Partners LP, which operates offices in California and Europe, and Gemini Israel LP in Israel.