Clumio Acquisition: Key Details, Impact, and What Comes Next

Commvault's acquisition of Clumio marks a significant step in enhancing its cloud resilience capabilities, particularly for AWS environments. This strategic move aims to bolster Commvault's cyber resilience offerings, providing customers with advanced data protection and recovery solutions. The integration of Clumio's technology is expected to strengthen Commvault's position in the SaaS-based data protection market, offering greater flexibility and choice for cloud-native applications.

What Is Clumio?

Founded in 2017, Clumio offers autonomous backup and recovery solutions for critical cloud data, focusing on AWS environments. Its core services include ransomware recovery, operational recovery, compliance solutions, and AWS backup cost optimization. Clumio's unique selling points include immutable and undeletable data for strong ransomware protection, a serverless and agentless platform requiring no management, and cost-saving measures that reduce backup expenses by over 30%. The platform ensures zero RTO at any scale with secure, air-gapped data.

Who Acquired Clumio?

Commvault is a leading provider of comprehensive cyber resilience solutions, specializing in data protection, backup, recovery, and management across enterprise, cloud, and SaaS environments. Key products include the Commvault Cloud Platform, Continuous Data Security, Continuous Readiness, and Continuous Recovery solutions. The company is recognized by major analysts like Gartner and Forrester, and its solutions are trusted by over 100,000 customers. Commvault holds a strong market position, particularly noted for its FedRamp High Certification.

When Was Clumio Acquired?

Commvault announced its acquisition of Clumio on September 24, 2024, with the deal expected to close in early October 2024. This acquisition aligns with industry trends of consolidation in the data protection sector and Commvault's strategic focus on enhancing its cloud resilience capabilities, particularly for AWS environments. The timing also coincides with increasing reliance on cloud services and the need for robust cyber resilience solutions.

Why Was Clumio Acquired?

• Market Expansion: The acquisition of Clumio allows Commvault to extend its market opportunities with AWS customers. This move strengthens Commvault's support for critical cloud data and workloads in AWS, including Amazon Simple Storage Service (AWS S3) and Amazon DynamoDB. Additionally, it enables Commvault to serve a broader range of customers who rely on AWS for their cloud storage and data protection needs.
• Technology Integration: Commvault plans to integrate Clumio’s highly scalable cloud data protection technology into its own cloud platform. Clumio's AWS offerings and innovations, such as near-instant access to Amazon S3 data during recovery operations, will enhance Commvault's cyber resilience capabilities. This integration aims to provide better data protection and recovery solutions for cloud-native applications.
• Competitive Advantage: By acquiring Clumio, Commvault enhances its cyber resilience offerings, providing best-of-breed protection for diverse cloud workloads. This strategic acquisition allows Commvault to leverage Clumio’s expertise and AWS offerings to provide cyber resilience to next-generation applications built on AWS. This move is expected to reinforce Commvault's position as a leading SaaS provider for cyber resilience, giving it a competitive edge in the market.

Acquisition Terms

• Acquisition Price: $47 million
• Payment Method: Funded with cash on hand
• Key Conditions or Agreements:
  • The acquisition is expected to close in early October 2024.
  • Clumio’s co-founders, Poojan Kumar and Woon Jung, along with other key members of the Clumio team, are joining Commvault.
  • The acquisition is expected to be immediately accretive to ARR (Annual Recurring Revenue) and revenue, and accretive to free cash flow within the next three quarters.
  • Until the integration is complete, Clumio’s offering will remain as a standalone service.
  • The Clumio brand will be referred to as "Clumio, a Commvault Company" during the integration process.
  • Commvault maintains its second fiscal quarter earnings guidance given in July 2024.
  • BofA Securities served as a financial advisor and Hogan Lovells LLP served as legal counsel to Commvault in connection with the transaction.

Impact on Clumio

The acquisition of Clumio by Commvault brings significant changes to Clumio's operations and management. Key members of Clumio's team, including co-founders Poojan Kumar and Woon Jung, are joining Commvault, ensuring a smooth integration of Clumio's technology into Commvault's cloud platform. This move aims to leverage Clumio's AWS expertise to enhance Commvault's cyber resilience capabilities. Initially, Clumio’s services will remain standalone, but they will be integrated into Commvault’s offerings over the next few quarters, providing a seamless transition for existing customers.

Regarding product offerings, the acquisition will bolster Commvault’s cyber resilience solutions, particularly for AWS environments. Clumio’s innovations, such as near-instant access to Amazon S3 data during recovery operations, will be integrated into Commvault’s platform, enhancing data protection and recovery solutions for cloud-native applications. While specific employee reactions are not detailed, the integration of Clumio’s team into Commvault suggests a positive outlook. Customers are expected to benefit from the enhanced capabilities, offering greater choice and robust protection for diverse cloud workloads.

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