Lenovo to acquire Infinidat as part of growth strategy
Infinidat's high-end storage offerings fill a Lenovo portfolio gap, but its acquisition winnows the number of storage vendors in the market, according to analysts.
Lenovo has agreed to acquire Infinidat to establish its own brand of high-end enterprise storage offerings.
The purchase is still undergoing regulatory review, and specifics such as price and impact to customers was not available at press time.
The acquisition provides Lenovo a high-performance and higher-end addition to its enterprise storage portfolio, a niche the company lacked as it expanded into AI and other demanding workloads, according to Simon Robinson, an analyst at Informa TechTarget's Enterprise Strategy Group.
"If Lenovo wanted to make a splash in the storage space, this would make it," Robinson said. "In the last year or so they've signified they want to be an infrastructure player of scale and consequence."
In a press release, Lenovo said it will combine Infinidat's sales and R&D with its existing teams to grow a high-end storage business and complement its existing entry and mid-range storage offerings.
Lenovo, headquartered in Hong Kong with operational headquarters in both Beijing, China and Morrisville, North Carolina, said it has $57 billion in revenue currently. Infinidat, a private company, was last valued at $1.6 billion following a funding round in 2017.
Market consolidation
The acquisition further winnows the enterprise storage market, but provides growth opportunities in equal measure for Lenovo and Infinidat, according to industry analysts.
Forrester Research analyst Brent Ellis said Lenovo's plan to merge sales and R&D teams rather than relying on existing Lenovo staff is a sign that the IT vendor understands it's entering a new space and needs Infinidat's expertise.
"The fact they're looking to leverage the experience of the Infinidat sales team is encouraging rather than them looking to chop up the company," Ellis said.
Infinidat likely experienced difficulties growing the business despite having a successful and respected product, Ellis said. The vendor faced competition from Dell Technologies and Hewlett Packard Enterprise as well as the cloud hyperscalers, Ellis said.
"[Infinidat] had a hard time leveraging that against entrenched players," he said. "It's not surprising they ended up being an acquisition target."
Lenovo has relied a partnership with NetApp to provide high-end storage to customers, according to Steve McDowell, founder and principal analyst at NAND Research. An acquisition was likely the only way Lenovo could quickly move into the high-end market -- with Infinidat among the few remaining independent companies.
Infinidat's market of customers is small, but includes research or government databases, he said. Those customers might not appreciate the change in management, he added.
"It's a very constrained market and [Infinidat] has a constrained product," McDowell said. "How will Infinidat customers feel about becoming Lenovo customers?"
Next targets
As the number of independent storage hardware vendors dwindles, software-defined storage (D platforms, such as those from DataCore or StorMagic, could become acquisition targets for enterprise IT vendors, Ellis said.
Ondat, an SDS vendor formerly known as StorageOS, was acquired in 2023 by Akamai Technologies in 2023 to provide a storage component to the vendor's cloud platform ambitions, he said.
Storage customers, he said, might ultimately have to choose between the hybrid cloud ecosystems of major players such as Dell and now Lenovo or those from cloud providers including AWS and Microsoft Azure, which have begun pushing into on-premises storage in recent years.
Tim McCarthy is a news writer for Informa TechTarget covering cloud and data storage.
