HP launches $1.6 billion bid for 3PAR

Hewlett-Packard Co offered $1.6 billion (£1.03 billion) for 3PAR Inc today, topping technology rival Dell's deal to buy the data storage company and potentially sparking a bidding war.

HP's move to acquire 3PAR for about one-third more than Dell's offer comes during a rush of mergers in the technology sector, with companies taking advantage of cash stockpiles and relatively low stock market prices.



For its part, HP has been looking to expand into new businesses, with acquisitions of network device maker 3Com, tech services provider Electronic Data Systems and mobile device company Palm. It has become a giant, sprawling enterprise in the process, with more than 300,000 employees.



"3PAR will further expand our strategic footprint in storage and diversify our offerings," Dave Donatelli, head of HP's enterprise server, storage and networking business, said on a conference call.



HP's $24-a-share offer for 3PAR marks a 33 percent premium to last week's bid by Dell, which the storage company's board has approved. At the time, Dell's bid marked an 87 percent premium to 3PAR's share price.



HP said it was awaiting a response from 3PAR. A representative from Dell was not immediately available, and 3PAR declined to comment.

HP, faced with turmoil in its top ranks after the resignation of Chief Executive Officer Mark Hurd, said it had been eyeing 3PAR before Dell's public announcement last week. It said its board had approved the bid.



"This has been a methodical process," Donatelli told Reuters. "We've given a superior offer, and we're confident in our business case and our proposal."



Some analysts had speculated that the absence of a permanent CEO may deter HP from dealmaking, but Donatelli said it would not be a hindrance.



"I have absolutely no concerns as it relates to this deal," he said.



Shares of 3PAR, which was founded in 1999 and posted revenue of $194 million (£125 million) in its last fiscal year, jumped 41.3 per cent to $25.49 after the HP announcement. HP stock was down 2.6 per cent at $38.80.



The competing bids for 3PAR come as technology heavyweights like International Business Machines Corp and Oracle Corp are vying to become one-stop shops for all of their customers' technology needs, including security and storage.



In particular, such vendors have been boosting investment in "cloud computing" technology, which enables users to access data and software over the Internet and corporate networks, allowing them to save space and costs.



Some analysts said HP's offer was surprising because Dell had offered such a steep premium, but they also raised the possibility of counteroffers.



Cross Research analyst Shannon Cross said another bidder could emerge in what would be a rare bidding war in the technology industry.



"I don't think they are making an acquisition just to hurt Dell; this is a strategic asset," she said. "Storage is a focused area for HP as well as others, and 3PAR has a good product set."



Cross said she expected to see more acquisitions like this one.



Donatelli said HP had met with 3PAR's senior executives and felt they would be an "excellent fit." The company offered terms that it said would be similar to those proposed by Dell, but would not include a termination fee.



HP said its proposed deal would close by the end of the year.

Life and Style
ebookNow available in paperback
ebooks
ebookA delicious collection of 50 meaty main courses
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Gadgets & Tech

    Metail Ltd: Business Development Manager for Asia Pacific

    £35,000 - £40,000 based on experience : Metail Ltd: As a Business Development ...

    Recruitment Genius: Customer Service Supervisor

    £15000 - £20000 per annum: Recruitment Genius: This company is a well establis...

    Guru Careers: Product Manager / Product Owner

    £30 - 40k (DOE) + Bonus & Benefits: Guru Careers: A Product Manager / Product ...

    Recruitment Genius: Customer Service Executive

    £30000 - £35000 per annum: Recruitment Genius: This company provides a number ...

    Day In a Page

    Greece says 'No': A night of huge celebrations in Athens as voters decisively back Tsipras and his anti-austerity stance in historic referendum

    Greece referendum

    Greeks say 'No' to austerity and plunge Europe into crisis
    Ten years after the 7/7 terror attacks, is Britain an altered state?

    7/7 bombings anniversary

    Ten years after the terror attacks, is Britain an altered state?
    Beautiful evening dresses are some of the loveliest Donatella has created

    Versace haute couture review

    Beautiful evening dresses are some of the loveliest Donatella has ever created
    No hope and no jobs, so Gaza's young risk their lives, climb the fence and run for it

    No hope and no jobs in Gaza

    So the young risk their lives and run for it
    Fashion apps: Retailers roll together shopping and social networking for mobile customers

    Fashion apps

    Retailers roll together shopping and social networking for mobile customers
    The Greek referendum exposes a gaping hole at the heart of the European Union – its distinct lack of any genuine popular legitimacy

    Gaping hole at the heart of the European Union

    Treatment of Greece has shown up a lack of genuine legitimacy
    Number of young homeless in Britain 'more than three times the official figures'

    'Everything changed when I went to the hostel'

    Number of young homeless people in Britain is 'more than three times the official figures'
    Compton Cricket Club

    Compton Cricket Club

    Portraits of LA cricketers from notorious suburb to be displayed in London
    London now the global money-laundering centre for the drug trade, says crime expert

    Wlecome to London, drug money-laundering centre for the world

    'Mexico is its heart and London is its head'
    The Buddhist temple minutes from Centre Court that helps a winner keep on winning

    The Buddhist temple minutes from Centre Court

    It helps a winner keep on winning
    Is this the future of flying: battery-powered planes made of plastic, and without flight decks?

    Is this the future of flying?

    Battery-powered planes made of plastic, and without flight decks
    Isis are barbarians – but the Caliphate is a dream at the heart of all Muslim traditions

    Isis are barbarians

    but the Caliphate is an ancient Muslim ideal
    The Brink's-Mat curse strikes again: three tons of stolen gold that brought only grief

    Curse of Brink's Mat strikes again

    Death of John 'Goldfinger' Palmer the latest killing related to 1983 heist
    Greece debt crisis: 'The ministers talk to us about miracles' – why Greeks are cynical ahead of the bailout referendum

    'The ministers talk to us about miracles'

    Why Greeks are cynical ahead of the bailout referendum
    Call of the wild: How science is learning to decode the way animals communicate

    Call of the wild

    How science is learning to decode the way animals communicate