With reference to ADIC's purchase of 10 percent of Overland's shares and a speculated acquisition - there is no ADIC buyout of Overland taking place. A person close to events said "There's nothing going on there at all. It's a really good panic story. It got us going too.... ADIC did this before with Quantum." He thinks that: "They're out just to make money or to cause short-term disruption."

The background is that Overland shares fell when the ending of the HP OEM agreement next year was announced. Then ADIC pounced and it's share purchase took place, leading to general speculation in the industry of an ADIC acquisition of Overland. To prevent such a purchase Overland put its poison pill defence in place.

According to our source Overland initially approached ADIC in January, not the other way round, looking to buy ADIC for its D2D backup products. Back then Overland intended to get into the primary disk protection market. (It has a 3-pronged strategy: archive data to tape (NEO); backup data to secondary disk (REO); and protect primary disk - with a new appliance.) Talks with ADIC led nowhere. Overland bought snapshot and replication software via its purchase of Zetta - deciding it really only needed the SW as the disk drive tin is a commodity.

It will launch its new ULTAMUS primary disk protection appliance in mid-October. This will have a protection O/S - the Zetta SW - and an 8-drive array. It will have mid-range pricing and Overland will look to supply the Protection O/S to other suppliers via an OEM arrangement.

Also Overland and Symantec are going to offer a HW/SW bundle. Veritas Backup Exec 10 will be bundled with Overland's REO disk-to-disk backup device. Symantec (Veritas) is having a big push into disk to disk backup. The official launch is Tuesday next week.

There may well be consolidation taking place in the tape product supplier industry but Overland is not looking to be consolidated by anyone. It doesn't need and doesn't want a white knight.