Wednesday, May 18, 2011

Autonomy to Acquire eDiscovery Business from Iron Mountain

Cambridge, England and San Francisco - 16 May 2011 - Autonomy Corporation plc (LSE: AU. or AU.L), a global leader in infrastructure software, and Iron Mountain Incorporated (NYSE: IRM), the information management company, today announced a definitive agreement for Autonomy to acquire selected key assets of Iron Mountain's digital division including archiving, eDiscovery and online backup. For customers, this means access to Autonomy's advanced technology for information governance in secure, private clouds in data centers around the world.

Acquisition Highlights


Cash consideration of $380 million (subject to a final working capital adjustment), funded from Autonomy's existing cash reserves. Post-closing Autonomy expects to have a gross cash balance of at least $700 million.

Adds over six petabytes of data under management and more than 6,000 customers to Autonomy's customer base, bringing Autonomy's private cloud data to over 25 petabytes and total customer base to over 25,000.

Assets acquired include digital archiving, eDiscovery and online backup and recovery solutions of Iron Mountain Digital, but not the technology escrow service and a medical records archive service and other smaller operations which were recently shut down.

Active Iron Mountain Digital customers will continue to be supported without disruption.

Autonomy to offer Connected, the digital data protection product, to existing Autonomy customers across enterprise server, PC and mobile devices. The addition of this product drives non-regulatory and structured data into our cloud-based information processing platform.

Expected go-forward revenues of approximately $130 million to $140 million.

Expect to achieve cost synergies of approximately $40 million per annum over the first year from completion, from a combination of efficiencies from utilization of

Restructuring costs of approximately $10 million expected in the two quarters following completion.

Acquisition expected to have traditional effect on gross margins and operating margins in first few quarters following completion with the result of slight earnings dilution in the first quarter after close, neutral for the full year 2011, and expected adjusted earnings per share accretion of approximately 15% in 2012. We would expect gross margins and operating margins to return to historical levels within one to two quarters of completion.

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