(July 09, 2001)
Milpitas, CA -DISC, INC. (NASDAQ Symbol: DCSR), a manufacturer
of automated solutions for enterprise storage, today announced it has
signed a definitive agreement to acquire all of the outstanding shares
of NSM Storage GmbH, a manufacturer of CD and DVD library systems.
Under the terms of the purchase agreement, DISC will
acquire all of the outstanding shares of NSM in exchange for up to 1.2
million shares of DISC common stock. The formal closing of the acquisition
will occur in approximately four to six weeks, upon the fulfillment of
certain conditions precedent set forth in the purchase agreement. The
acquisition will be accounted for as a purchase. NSM will become a wholly
owned subsidiary of DISC and will continue to serve their existing markets
from its existing facilities in Bingen, Germany.
This transaction aims to enhance a mutually held strategy
of DISC and NSM to deliver storage solutions for a fraction of the total
cost of RAID and to provide enterprise storage solutions for today's enterprise
networks for less than 2 cents per megabyte.
J. Richard Ellis will continue to serve as President
and CEO of DISC. Wilfried Beckmann, managing director of NSM, will remain
managing director of NSM, and will become a Vice-President of DISC.
The merger of DISC and NSM will give their combined customers a line of
NearLine storage products encompassing both the DVD-RAM and Magneto-Optical
storage technologies. Historically, NSM has focused on the CD and DVD
library market and DISC has focused on the larger capacity, high-end Magneto-Optical
market. In addition to an expanded product offering, the combined company
will have manufacturing, sales and customer service in the United States
and the European Community, the two geographic markets that account for
85% of all IT purchases worldwide. NSM will continue to serve the market
needs of the European Community, and DISC will serve the needs of the
North American market. As a combined entity, NSM and DISC will also expand
their existing relationships in the international marketplace outside
Europe and North America.
J. Richard Ellis, President and CEO of DISC stated,
"By combining the two companies, we have one of the rare occurrences
where the whole is greater than the sum of the parts. This acquisition
allows us to broaden our technology offering, increase our research and
development resources, and increase our revenue base. It also provides
us with a local manufacturing and sales presence in the European Community
and expands our global sales channels. Additionally, the combined product
lines of NSM and DISC will give us a range of storage solutions that can
be tailored to satisfy the storage requirements of our customers."
Ellis continued, "NSM is the European market leader in CD and DVD
libraries and the technology and quality reputation that it has developed
will allow us to grow as leaders in both the United States and the European
Community as well as the rest of the world."
Wilfried Beckmann, Managing Director of NSM Storage
GmbH, commented, "Through our strategic partnership, DISC and NSM
have developed a strong mutual respect as innovators in the NearLine storage
market. This merger will allow NSM to offer high-end enterprise storage
solutions and take advantage of the sales presence that DISC has established
in the United States." Beckmann added, "The strength of NSM's
brand name in Europe, its industry leading research and development efforts,
and the combined local presence of DISC and NSM in both the European community
and the United States set the stage for accelerated growth."
About NSM Storage:
NSM Storage GmbH, founded in 1994 as a subsidiary of the Bingen company,
NSM AG, has played a leading role in the development, production and marketing
of audio jukeboxes for more than four decades. NSM Storage GmbH has benefited
from its parent company in the fields of robotics and control electronics.
Today, NSM Storage GmbH has more than 90,000 jukebox systems installed
worldwide, making it the leading company in this sector. In addition to
subsidiaries in the United States, the United Kingdom and France, the
company also has authorized distributors and service partners for sales
of CD and DVD jukebox solutions and local customer support in 40 countries.
Established in 1986, DISC, Inc., a manufacturer of automated library solutions,
provides companies with storage devices that add capacity to networks
for a fraction of the total cost of RAID. DISC's storage solutions range
in capacity from 40 GB to 9.5 TB. Headquartered in Milpitas, CA, DISC,
Inc. can be found on the World Wide Web at www.disc-storage.com. Sales
and development offices are located in Northern California, Chicago, Boston,
Dallas, Tampa, New York, Washington D.C., Bingen, Germany, London and
Asia. In addition to these offices, the company also has authorized resellers,
distributors and service partners for sales of NearLine storage solutions
and local customer support in 40 countries. In North and South America,
DISC can be reached by calling (800) 944-3472 or (408) 934-7000. For all
other locations, please contact DISC at the European office at +49 (0)
6721.964.430. DISC can also be reached by e-mail at email@example.com.
DISC is a registered trademark. Any other product names are trademarks
or registered trademarks of their respective companies.
Statements made in this news release are forward looking
statements that include risks and uncertainties. These forward looking
statements include statements concerning DISC's product capabilities and
leadership, the combined strength of DISC and NSM, the range and capabilities
of and potential markets for the combined company's products and services,
and the potential for rapid growth and increasing market share. DISC's
future operating results are uncertain and may be affected by the following
factors, among others: DISC's ability to obtain additional financing which
it anticipates will be required to continue to finance its operations,
rapid technological change and competitive developments, the ability of
DISC to successfully market its products, risks related to the growth
prospects of the markets that the DISC serves, DISC's dependence on successfully
developing, introducing and commercializing new products, developing enhancements
to existing products, the timing of product orders, DISC's history of
losses, the loss of customers or distributors and increased competition
and pricing pressure.
Further information on these and other factors is provided
in DISC's Annual Report on Form 10-K for the year ended December 31, 2000.
All forward-looking statements are based on information available to DISC
on the date hereof, and DISC assumes no obligation to update such statements.