In a major acceleration of its Global Enterprise Data Center strategy, McDATA Corporation, a leading provider of storage networking solutions, announced a definitive agreement to acquire Computer Network Technology Corporation (CNT), a leader in the WAN extension/networking space providing storage area networking products, software, services and solutions. The all-stock transaction, valued at approximately $235 million in equity and debt (based on net debt as of October 31, 2004), will create a leader in enterprise storage networking. The combination of the companies' complementary products and services will provide customers with the long-term confidence that their strategic requirements for a storage networking infrastructure needed for increased productivity, business continuity and regulatory compliance will be met.
Under the terms of the agreement, which was approved by both companies' boards of directors, CNT shareholders will receive 1.3 shares of McDATA Class A common stock for each share of CNT common stock they hold. Upon completion of the transaction, which is expected in McDATA's fiscal second quarter 2005, McDATA and CNT stockholders will own approximately 76% and 24%, respectively, of the combined company.
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