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Monday, Sep 16
Violin Memory sets IPO price range of $8-$10
- Violin (VMEM) is selling 18M shares, and is thus looking to raise $144M-$180M. The price range spells a valuation of $654M-$818M. JPMorgan, Deutsche, and BofA/Merrill are the lead underwriters. (S-1)
- The flash storage system vendor had revenue of $51.3M (+69% Y/Y) in the 6 months ending July 31, and a net loss of $59.2M. Gross margin was 41.3%, somewhat low for an enterprise storage firm. R&D spend totaled $34.7M, and sales/marketing spend $36.9M.
- Violin's IPO will shortly follow Cisco's acquisition of rival flash system maker Whiptail, and Western Digital's acquisition of server flash card vendor Virident. Fusion-io shares have already taken off thanks to M&A speculation; will Violin get a boost of its own?
- Other peers that were acquired: XtremIO, Texas Memory
- Violin's momentum has been slowed down some by the unraveling of its H-P reseller deal. After accounting for 65% of its FY12 (ended Jan. '12) revenue, H-P has made up less than 10% of Violin's revenue in the following 6 quarters.
- Much like Whiptail (previous), Violin asserts its use of a hardware architecture and proprietary software built from the ground up with flash storage needs in mind give it a performance edge. The company relies on algorithms to help optimize flash performance, and a partnership with Toshiba to secure high-end NAND flash chips.
- Another Violin rival, Nimble Storage, is reportedly prepping an IPO.