Dell has entered into an agreement to acquire SAN (storage area network) vendor EqualLogic for US$1.4 billion, the companies announced Monday.

EqualLogic sells iSCSI (Internet Small Computer System Interface) SAN products optimized for virtualization and the acquisition will strengthen Dell's efforts to simplify and virtualize IT for its customers, Dell said in a news release.

Internet SCSI allows for SCSI commands and storage traffic to occur over existing IP (Internet Protocol) networks, which can lead to lower costs, easier maintenance and simpler management, according to proponents. Many iSCSI products are targeted toward small and medium-sized businesses.

Customers will have to deal with the "largest increase in data we have seen in our history" during the next several years, Michael Dell, the company's chairman and CEO, said in a statement. "Leading the iSCSI revolution will help Dell accelerate IT simplification and virtualization," he added.

Dell expects the acquisition to close late in the fourth quarter of this year or early in the first quarter of next year. The acquisition has been approved by the board of directors of each company and is subject to regulatory approvals.

Dell plans to add to EqualLogic's channel-partner programs with more EqualLogic-branded products, and it also plans to incorporate EqualLogic technology into future generations of its Dell PowerVault storage line, the company said.

EqualLogic, based in Nashua, New Hampshire, has more than 3,200 customers in 30 countries. It shipped its first product in June 2003.