Thursday, November 01, 2007

Iron Mountain Buys E-Discovery Firm

Iron Mountain will shell out $158 million in cash to buy e-discovery company Stratify Inc. by the end of the year, if shareholders and regulators approve.

Iron Mountain announced the deal as part of its third-quarter earnings report this morning. It has had a partnership with Stratify since January 2007, and execs say the relationship fared well among enterprise customers from the start.

Stratify, a profitable privately held firm founded in 1999 and headquartered in Mountain View, Calif., is predicted by Iron Mountain to be on track for $30 million revenues this year. It has around 110 customers and 185 employees, about half of whom reside in Bangalore, India. Iron Mountain says Stratify's profit margin is now between 20 percent and 30 percent, but the new parent plans to improve on that. Earnings from Stratify, however, will be minimally accretive to Iron Mountain's earnings in the first quarter of full ownership, execs say.

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