NetApp Inc. agreed to acquire fellow data-storage company Data Domain Inc. in a deal valued at $1.5 billion, even as it posted a 16% decline in fiscal fourth-quarter profit and avoided giving an outlook due to the uncertain economy.

NetApp, Sunnyvale, Calif., said it will pay a combination of cash and stock valued at $25 for each share of Data Domain, a 40% premium to Wednesday's closing price of $17.91 on the Nasdaq Stock Market. Data Domain's stock last traded at $25 last June.

Both companies make devices used to store computer data and compete with market leader EMC Corp. Data Domain, Santa Clara, Calif., specializes in technology that helps eliminate the storage of redundant data.

NetApp and Data Domain are "a good match," said Mark Kelleher, an analyst at Brigantine Advisors. He added the deal is also sign of ongoing consolidation among companies that make data-center equipment.

WSJ