Violin Memory Files for $172.5 Million IPO

violin-mem-6000

The Violin Memory series 6000 storage array.

Violin Memory, a flash storage provider, announced that it has filed a S-1 registration statement related to the proposed initial public offering (IPO) of its common stock. Initial plans laid out call for an estimated value of $172.5 million. The company plans to list its common stock on the New York Stock Exchange under the ticker symbol “VMEM.” The funds will be used for working capital and general corporate purposes, including further expansion of sales and marketing efforts, and continued investment in research and development.

With a 14 percent stake, Toshiba is listed as the largest shareholder currently, with other investors over the years have including GE Asset Management, Highland Capital Partners, the venture arm of SAP, Juniper Networks and SAP Ventures. Since Violin Memory was founded in 2005, the market has become crowded. Gartner ranked Violin Memory No. 1 in a flash array market share report, showing Violin with a nearly 20 percent market share in the flash-based storage array category.

Listed as a risk in the Violin Memory S-1 filing is the historical note of large purchases. In 2012, Hewlett Packard represented 65 percent of total revenue, where in 2013 and the six months ending July 31, 2013, Hewlett Packard represented less than 10 percent of total revenue. The filing also notes that it is a competitive market, with incumbent vendors like Dell, EMC, Hitachi, NetApp, IBM and others.

Flash competitor Fusion-io (FIO) filed its IPO in 2011, and has struggled on the stock market since. Another competitor, Pure Storage has been growing rapidly, and has been rumored to be looking at an IPO as well.