Brocade Communications Systems is snapping up Riverbed Technology’s virtual application delivery controller (ADC) product line, called SteelApp, in an all-cash deal expected to close in the second quarter, the two companies announced late Thursday.
Financial terms of the deal were undisclosed.
The market for ADCs, data center appliances that manage application acceleration and server load balancing, has been an early leader in the shift from hardware network functions to NFV. Last quarter, virtual ADC revenues grew 17 percent from the prior quarter, while hardware ADC revenue shrank 1 percent, according to a report from Dell’Oro Group.
Brocade will get the assets and personnel of Riverbed’s SteelApp business unit through the acquisition, bolstering the networking giant’s network function virtualization (NFV) product line. The SteelApp acquisition pits Brocade against ADC heavyweight F5 Networks, which dominates 52 percent of the market by revenue, according to Dell’Oro.
The move by Brocade echoes the company’s 2012 acquisition of Vyatta, maker of the the software-defined network (SDN) controller that Brocade has used to enter the SDN market. Brocade’s most recent acquisition came in September, when the company bought Vistapointe, maker of network analytics software designed to help mobile network operators transition to NFV.
Facing pressure from activist shareholder Elliot Management, Riverbed in December agreed to go private through a $3.6 billion acquisition by private equity firm Thoma Bravo. That deal is expected to close in the first half of 2015.