EMC Corp. agreed to sell control of its Syncplicity online file-sharing business to Skyview Capital LLC.
EMC will maintain a minority stake in Syncplicity, the company said Tuesday in a statement. Financial terms weren’t disclosed. EMC doesn’t see Syncplicity, which competes with cloud startup Box Inc., as crucial to its core mission of selling storage hardware and software, according to a person familiar with the matter, who asked not to be identified discussing private information.
While Syncplicity’s bookings are about doubling annually, the unit is unprofitable, according to the person. After the sale, EMC, which acquired Syncplicity three years ago, will be a preferred storage partner for Syncplicity and will be able to continue selling to its customers.
EMC, which sells technology to corporations, is contending with weak demand for its most expensive storage equipment and is trying to compensate by focusing on new products like flash-memory-based machines. Activist shareholder Elliott Management Corp. has been pressuring the Hopkinton, Massachusetts-based company to explore options for its businesses, including a spinoff of software maker VMWare Inc.
Last year, EMC acquired most of Cisco Systems Inc.’s stake in joint venture VCE, which sells high-end data-center equipment. EMC also held talks about a merger with Hewlett-Packard Co., which stalled over disagreements on price, people familiar with the matter said at the time.
Both Box and Syncplicity show the challenges of making money in the market for software that helps companies synchronize and share files. Box, which sold shares to the public in January, is also losing money as it spends on marketing and increasing its sales force to line up new customers.