EMC to buy Legato Systems

Information storage company EMC has announced its plan to acquire LEGATO Systems, Inc.(Nasdaq:LGTO) in a stock transaction valued at approximately $1.3bn (€1.1bn).

This is the 10th purchase that EMC has made in the past three years, as with the slowing of hardware sales it has tried to find new sources of revenues. Also, revenues from sales of software and services have a higher margin than its hardware sales.

Legato is a provider of enterprise-class software solutions and services for information lifecycle management. This helps organisations achieve business continuity, operational efficiency and regulatory compliance. Legato’s solutions are delivered through a worldwide network of strategic partnerships and alliances, as well as a direct sales force.

Analysts see the acquisition of Legato’s sales expertise and sales force as also being of great value to EMC.