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.

PROMOTED VIDEO
Life and Style
ebooksA superb mix of recipes serving up the freshest of local produce in a delicious range of styles
Life and Style
ebooksFrom the lifespan of a slug to the distance to the Sun: answers to 500 questions from readers
News
video
Arts and Entertainment
Martin Amis: Taken to task over rash decisions and ill-judged statements
booksThe Zone of Interest just doesn't work, says James Runcie
Life and Style
life – it's not, says Rachel McKinnon
Arts and Entertainment
Eye of the beholder? 'Concrete lasagne' Preston bus station
architectureWhich monstrosities should be nominated for the Dead Prize?
Travel
travelFrom Notting Hill Carnival to Zombeavers at FrightFest
Independent
Travel Shop
the manor
Up to 70% off luxury travel
on city breaks Find out more
santorini
Up to 70% off luxury travel
on chic beach resorts Find out more
sardina foodie
Up to 70% off luxury travel
on country retreats Find out more
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

    Senior Network Integration/Test Engineer

    £250 - £300 per day: Orgtel: Senior Network Integration/Test Engineer Berkshir...

    Software Developer - Newcastle - £30,000 - £37,000 + benefits

    £30000 - £37000 per annum + attractive benefits: Ashdown Group: .NET Developer...

    Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...

    Digital Project Manager/BA

    £300 Per Day: Clearwater People Solutions Ltd: An experienced Digital/Ecommerc...

    Day In a Page

    Middle East crisis: We know all too much about the cruelty of Isis – but all too little about who they are

    We know all too much about the cruelty of Isis – but all too little about who they are

    Now Obama has seen the next US reporter to be threatened with beheading, will he blink, asks Robert Fisk
    Neanderthals lived alongside humans for centuries, latest study shows

    Final resting place of our Neanderthal neighbours revealed

    Bones dated to 40,000 years ago show species may have died out in Belgium species co-existed
    Scottish independence: The new Scots who hold fate of the UK in their hands

    The new Scots who hold fate of the UK in their hands

    Scotland’s immigrants are as passionate about the future of their adopted nation as anyone else
    Britain's ugliest buildings: Which monstrosities should be nominated for the Dead Prize?

    Blight club: Britain's ugliest buildings

    Following the architect Cameron Sinclair's introduction of the Dead Prize, an award for ugly buildings, John Rentoul reflects on some of the biggest blots on the UK landscape
    eBay's enduring appeal: Online auction site is still the UK's most popular e-commerce retailer

    eBay's enduring appeal

    The online auction site is still the UK's most popular e-commerce site
    Culture Minister Ed Vaizey: ‘lack of ethnic minority and black faces on TV is weird’

    'Lack of ethnic minority and black faces on TV is weird'

    Culture Minister Ed Vaizey calls for immediate action to address the problem
    Artist Olafur Eliasson's latest large-scale works are inspired by the paintings of JMW Turner

    Magic circles: Artist Olafur Eliasson

    Eliasson's works will go alongside a new exhibition of JMW Turner at Tate Britain. He tells Jay Merrick why the paintings of his hero are ripe for reinvention
    Josephine Dickinson: 'A cochlear implant helped me to discover a new world of sound'

    Josephine Dickinson: 'How I discovered a new world of sound'

    After going deaf as a child, musician and poet Josephine Dickinson made do with a hearing aid for five decades. Then she had a cochlear implant - and everything changed
    Greggs Google fail: Was the bakery's response to its logo mishap a stroke of marketing genius?

    Greggs gives lesson in crisis management

    After a mishap with their logo, high street staple Greggs went viral this week. But, as Simon Usborne discovers, their social media response was anything but half baked
    Matthew McConaughey has been singing the praises of bumbags (shame he doesn't know how to wear one)

    Matthew McConaughey sings the praises of bumbags

    Shame he doesn't know how to wear one. Harriet Walker explains the dos and don'ts of fanny packs
    7 best quadcopters and drones

    Flying fun: 7 best quadcopters and drones

    From state of the art devices with stabilised cameras to mini gadgets that can soar around the home, we take some flying objects for a spin
    Joey Barton: ‘I’ve been guilty of getting a bit irate’

    Joey Barton: ‘I’ve been guilty of getting a bit irate’

    The midfielder returned to the Premier League after two years last weekend. The controversial character had much to discuss after his first game back
    Andy Murray: I quit while I’m ahead too often

    Andy Murray: I quit while I’m ahead too often

    British No 1 knows his consistency as well as his fitness needs working on as he prepares for the US Open after a ‘very, very up and down’ year
    Ferguson: In the heartlands of America, a descent into madness

    A descent into madness in America's heartlands

    David Usborne arrived in Ferguson, Missouri to be greeted by a scene more redolent of Gaza and Afghanistan
    BBC’s filming of raid at Sir Cliff’s home ‘may be result of corruption’

    BBC faces corruption allegation over its Sir Cliff police raid coverage

    Reporter’s relationship with police under scrutiny as DG is summoned by MPs to explain extensive live broadcast of swoop on singer’s home