HP gatecrashes Dell deal with 3Par

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The Independent Online

Hewlett-Packard and Dell, the two largest computer manufacturers in the US, are duking it out for control of a California-based data storage firm as the move towards cloud computing accelerates consolidation in the industry.

3Par, which sells servers and software used for storing and managing massive amounts of data, has received a $1.6bn (£1bn) takeover offer from HP – less than a week after agreeing to be acquired by Dell for $1.15bn.

Shares in the Fremont, California, based company surged even above the level of the HP offer, as investors bet on a bidding war and a higher offer from Dell.

Both Dell and HP are looking beyond their traditional PC businesses for growth, to become IT hardware, software and services providers to large and small businesses, in competition with other tech titans, such as IBM and Oracle.

The interest in 3Par reflects the growing importance of so-called cloud computing, where data is stored not on personal computers but on third-party hardware housed in large data centres.

Cloud computing has exploded in popularity because companies can be much more flexible if they rent the space they need, instead of building their own storage centres. Businesses are also using software over the internet, while the rise of social websites such as Facebook also means vast amounts of data now need to be stored somewhere.