Imation and IronKey have also entered a strategic partnership whereby Imation receives an exclusive license from IronKey for its secure storage management software and service, and a license to use the IronKey brand for secure storage products. IronKey will partner with Imation to provide its online cloud-based security services.

"This acquisition is another important step in Imation's strategy to grow in the secure and scalable storage markets, augmenting our global leadership position in high-security data storage and device management," said Mark Lucas, president and chief executive officer, Imation Corp. "As Imation continues its strategic transformation, we are making key technology investments in growth markets that will enable us to extend our position in data storage, security, archiving, and protection. With our global reach and strong channel relationships, data storage experience spanning nearly 60 years, and focus on addressing the unique storage needs of small and medium business, enterprise, and government customers, we have a solid leadership foundation. Now, we are executing on targeted technology acquisitions and strategic partnerships to accelerate our transformation," Lucas concluded.

Imation entered the high-security data storage and device management market in 2010 with the launch of its Defender™ line of secure hardware and software management products. In March 2011, Imation acquired ENCRYPTX, a leader in encryption and software security solutions for removable storage devices and media. The Company followed this with the acquisition of MXI Security in June 2011, adding MXI technologies and solutions for device security, including the Stealth Zone platform for secure computing environments. Now, with the October 2011 acquisition of IronKey's secure hardware business and strategic partnership with IronKey, Imation has created the industry's broadest portfolio of secure mobile storage offerings.

The Company also announced the formation on of its dedicated Global Mobile Security unit headquartered in Sunnyvale, Calif., integrating with Imation's international locations serving customers in more than 100 countries.

"With these key acquisitions in secure storage, Imation not only adds important technology, intellectual property, and skill sets, it also welcomes thousands of new enterprise and government customers to our already significant customer base worldwide," said Lawrence Reusing, General Manager, Global Mobile Security for Imation. "The addition of the IronKey secure USB storage product offerings, which support cloud-based management, enables us to continue to expand in the fast-growing high-security USB device market. Imation has a significant technology leadership position that will deliver the industry's most complete solution set for organizations need to secure their mobile data and mobile workspaces."

Imation's strategic focus on data security solutions addresses the growing market need for businesses, governments and end users to protect their ever-increasing amounts of data against loss, theft or security breaches. According to the Ponemon Institute, the cost of data breaches continues to rise annually, with the average organizational cost of a breach reaching $7.2 million in 20101.

Imation and IronKey previously announced a definitive agreement for the acquisition and strategic partnership by press release on September 20, 2011. Approximately 40 employees transferred to Imation with the acquisition. Financial terms of the acquisition were not disclosed. Imation was advised on the transaction by XMS Capital Partners and Faegre & Benson LLP.