Seagate To Buy Dot Hill Systems For $694 Mln.

(RTTNews) - Storage solutions provider Seagate Technology plc (STX) on Tuesday agreed to buy Dot Hill Systems Corp (HILL), a supplier of innovative software and hardware storage systems, for $9.75 per share in cash, or about $694 million.

As Dot Hill has about $49 million in cash as of June 30, the deal reflects an enterprise value of about $645 million, Seagate said. The deal consideration represents a 50% premium over the preceding three month stock price average.

Seagate expects the deal to be accretive to non-GAAP earnings in fiscal 2016.

The deal is expected to close during the fourth calendar quarter of 2015, and is subject to customary closing conditions, including a minimum tender of a majority of outstanding Dot Hill shares.

Seagate said Dot Hill's external storage array-based systems and software products will complement and expand its storage systems offerings and be offered as part of Seagate's Cloud Systems and Electronics Solutions business.

Seagate also said it will leverage Dot Hill's storage technology IP portfolio and software capabilities to drive innovation and provide incremental value to their combined OEM customer base.

Following the successful completion of the tender offer, Seagate will acquire all remaining shares not tendered in the tender offer through a second-step merger at the same price as to be paid to stockholders tendering their shares in the tender offer.

STX closed Tuesday at $52.05, down $0.40 or 0.76%, on the Nasdaq.

HILL closed at $5.18, down $0.26 or 4.78%, on the Nasdaq.