Wasabi acquires Lyve Cloud

Wasabi Technologies Inc. is set to expand its footprint in cloud storage through the acquisition of Seagate Technology Inc.'s Lyve Cloud business. This move enhances Wasabi's position in the competitive market of firms offering Amazon Web Services S3-compatible object storage solutions. While the financial terms were not disclosed, Seagate will obtain an equity stake in Wasabi as part of the agreement.

Wasabi, headquartered in Boston, plans to integrate Lyve Cloud into its operations over time, according to CFO Michael Bayer. This acquisition provides Wasabi with an established enterprise customer base and scalability. The initiative also marks a pivot for Seagate, which will redirect its focus towards its primary mass-capacity storage hardware business while retaining an interest in Wasabi's future growth. David Friend, Wasabi's co-founder and CEO, highlighted that this deal reinforces their standing as a leading provider of pure-play cloud storage services.

Lyve Cloud, launched by Seagate in 2021, has been designed as an enterprise-level storage platform known for its straightforward pricing and strong emphasis on security and compliance. The acquisition fits into an industry trend where businesses managing extensive data volumes are seeking alternatives to traditional hyperscale cloud solutions, particularly due to the complexities and costs associated with such providers. Wasabi's flat-rate pricing model aims to cater to these needs, providing a more predictable cost structure for key workloads like backup, analytics, and video.

The partnership is slated to bolster Wasabi's capabilities in the backup and recovery sectors. Both firms have existing relationships with key data protection players such as Veeam Software Inc., Rubrik Inc., and Commvault Systems Inc. This merger could simplify operations for clients who currently navigate multiple storage jurisdictions. For Seagate, transitioning Lyve Cloud to Wasabi allows it to exit direct cloud service provision, yet maintain exposure through its equity stake in Wasabi.

Looking forward, Wasabi will transition Lyve Cloud customers to its global data center network, which is compatible with Amazon S3 APIs. The focus remains on enhancing Wasabi's service offerings while leveraging the strategic partnership with Seagate. The integration timeline and customer transition specifics will be keen areas of focus as the deal progresses.