Red Hat Acquires Gluster, Inc. for $136 Million

Recently, Red Hat, Inc. announced its acquisition of Gluster, Inc., a Nexus Ventures supported company. Gluster, Inc. is a provider of scalable, open source cloud storage solutions, which was acquired at $136 million dollars.

The negotiation is to be sealed within this month with Red Hat assuming all of Gluster’s equity balances on the closing date of the agreement.

Hitesh Chellani and Anand Babu Periasamy founded Gluster in 2005. In 2008 they were able to raise $4 million for their series A funding from Nexus Venture Partners. And in November last year, they received their series B funding from Index Ventures and another round from Nexus Venture Partners.

In a statement, Brian Stevens, CTO and vice president, Worldwide Engineering at Red Hat said “The explosion of big data and the new paradigm of cloud computing are converging, forcing IT to re-think storage investments that are cost-effective, manageable and scale for the future.”

The clamor from their customers initiated their move to acquire Gluster, Stevens said “Our customers are looking for software-based storage solutions that manage their file-based data on-premise, in the cloud and bridging between the two. With unstructured data growth (such as log files, virtual machines, email, audio, video and documents), the 90′s paradigm of forcing everything into expensive, single-system DBMS residing on an internal corporate SAN has become unwieldy and impractical.”

GlusterFS is the flag carrier software of Gluster, a scalable software storage system that allows business enterprises to merge huge files and compute IT resources using a reliable, accessible and manageable storage pool that can be accessed globally.

“We believe this is a perfect combination of technologies, strategies and cultures and is a great development for our customers, employees, investors and community. Gluster started off with a goal to be the Red Hat of storage. Now, we are the storage of Red Hat.” The Co-founder and CTO of Gluster, AB Periasamy said.

Meanwhile, Henry Baltazar, senior analyst of The 451 Group said “Enterprises and service providers have struggled to manage their rapidly expanding unstructured data stores with conventional storage systems. The scale out storage technology and expertise Red Hat is gaining from the acquisition of Gluster will serve as a powerful foundation for future public, private and hybrid storage clouds.”

Although the acquisition of Gluster  by Red Hat will not have any immediate impact to the company’s revenue this year, Charlie Peters, Executive Vice President and CFO of Red Hat said “Industry analysts estimate the total addressable market for unstructured data storage at approximately $4 billion and growing. This is an exciting new area of potential growth for Red Hat and one in which we intend to invest aggressively.”