Quantum will acquire Benchmark Storage

In a move to further broaden its corner on the tape backup market, Quantum Corporation has entered into an acquisition agreement with Benchmark Storage, another manufacturer of disk-based storage. According to Quantum, the deal gives Benchmark's shareholders a cash payment of $11 million, 13.1 million Quantum shares of stock, and provides a performance-based incentive of a grant of 1.9 million additional shares upon achievement of certain milestones. Prior to the agreement, Quantum already owned 20% of Benchmark's shares. Quantum produces tape drives for backing up computer data in the event of a computer's loss of data or hardware crash. Quantum subsequently announced that it would be subcontracting the manufacturing of its tape drives to a Malaysian based company, Jabila, in order to cut overhead and other costs. According to Quantum, Jabila will hire most of Quantum's employees who are willing to transfer to Malaysia.

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