Kara Swisher

Recent Posts by Kara Swisher

VMware Forks Over $420 Million for SpringSource (Plus the Press Release, Etc.)

It’s certainly acquisition fever in Silicon Valley today.

After it was announced that that social networking giant Facebook had bought online content sharing start-up FriendFeed, now comes the news that VMware has purchased SpringSource, a privately held enterprise and Web application development and management cloud computing start-up.

The price? That would be $420 million in cash and stock.

While the blogosphere–including BoomTown–will inevitably find the FaceFeed deal more riveting, this one is obviously more important.

With the purchase of San Mateo, Ca.-based SpringSource, Palo Alto, Calif.-based, VMware (VMW)–which is a top player in the virtualization space–is adding to its cloud-computing application-management strength and its ties to the open-source community.

Said VMware in a press release about the five-year-old SpringSource buy:

“VMware will acquire SpringSource for approximately $362 million in cash and equity plus the assumption of approximately $58 million of unvested stock and options. The acquisition has been approved by SpringSource’s stockholders and is expected to close in the third quarter of 2009, subject to customary closing conditions.”

Here’s the full press release from VMware (plus, here is a link to a blog post by SpringSource CEO Rod Johnson:

VMware to Acquire SpringSource

Company Adds Modern Application Platform to Cloud Infrastructure Strategy

PALO ALTO, Calif., August 10, 2009–VMware, Inc., (NYSE: VMW), the global leader in virtualization solutions from the desktop through the datacenter and to the cloud, today announced a major step forward in its journey to help simplify IT by entering into a definitive agreement to acquire privately held SpringSource, a leader in enterprise and web application development and management. VMware and SpringSource plan to deliver compelling new solutions that enable companies to more efficiently build, run and manage applications within both internal and external cloud architectures.

“Today’s modern computing environments are moving to an application and data-centric world powered by state of the art virtualized and cloud computing platforms,” said Paul Maritz, president and chief executive officer, VMware. “The combination of SpringSource and VMware capitalizes on this shift and places us right at the intersection of the most important forces in the software market today–virtualization, modern application frameworks and cloud computing.”

VMware will acquire SpringSource for approximately $362 million in cash and equity plus the assumption of approximately $58 million of unvested stock and options. The acquisition has been approved by SpringSource’s stockholders and is expected to close in the third quarter of 2009, subject to customary closing conditions.

SpringSource is the innovator and driving force behind some of the most popular and fastest growing open source developer communities, application frameworks, runtimes, and management tools. In just five years, SpringSource has established a presence in a majority of the Global 2000 companies, and is rapidly delivering a new generation of commercial products and services. VMware plans to continue to support the principles that have made SpringSource solutions popular: the interoperability of SpringSource software with a wide variety of middleware software, and the open source model that is important to the developer community.

Together, VMware and SpringSource plan to further innovate and develop integrated Platform as a Service (PaaS) solutions that can be hosted at customer datacenters or at cloud service providers. These solutions will allow customers to rapidly build new enterprise and web applications and run and manage these applications in the same dynamic, scalable and cost-efficient vSphere-based internal or external clouds that can also host and manage their existing applications, providing an evolutionary path to the future. Forrester Research expects the emerging and rapidly growing PaaS market to expand to $15B by 2016. (Platform-As-A-Service Market Sizing, July 13, 2009)

“VMware has led the modernization of datacenter infrastructures through innovative virtualization and cloud architectures, providing customers with cost savings, agility and choice,” said Rod Johnson, chief executive officer, SpringSource. “The SpringSource team and community are committed to revolutionizing the way companies build, run and manage applications. By combining forces, I’m confident that we’ll be able to deliver a set of truly remarkable solutions that dramatically simplify enterprise IT.”

Background on SpringSource

SpringSource is at the forefront of “lean software,” a concept that is being rapidly adopted by enterprises focused on dramatically cutting cost and complexity, increasing productivity, and accelerating the delivery of high-quality, business-critical applications. SpringSource’s offerings and their underlying open-source technologies are uniquely able to address a wide range of corporate, web and commercial applications through a dynamic, yet consistent architecture. SpringSource counts a majority of the Global 2000 as current customers, and has a rapidly growing business delivering support, training and commercial software based on the well-known open source technologies and communities led by SpringSource:

The Spring Framework is the leading enterprise Java programming model; currently supporting half of all enterprise Java projects and used by approximately two million developers worldwide. The Spring Framework provides a high productivity, lightweight programming environment that makes applications portable across open source and commercial application server environments from IBM, Oracle and others.

Apache Tomcat is the world’s most widely used Java application server, deployed at more than 60% of all organizations running Java server applications. SpringSource is the key contributor to and maintainer of Tomcat and is responsible for more than 95% of the bug fixes over the past two years.

SpringSource leads Groovy and Grails, a rapidly growing dynamic language and Web application framework, each with more than 70,000 downloads per month. Together, Groovy and Grails deliver the rapid application productivity of Ruby on Rails for web applications, while maintaining skill-set and infrastructure compatibility with Java Virtual Machine (JVM) environments.

With more than 3,500 deployments worldwide, SpringSource’s Hyperic application monitoring and management tools are recognized as among the leading open source offerings in the space. In March, SpringSource/Hyperic was named one of Gartner’s “Cool Vendors in Cloud Computing Management and Professional Services.”

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