Computer giant Hewlett-Packard (HP) emerged the winner on Thursday in a bidding war with Dell for 3PAR after raising its offer for the data storage company to US$33 per share, or US$2.35 billion.
HP and 3PAR make a “winning combination,” HP executive vice president Dave Donatelli said in a joint statement confirming the deal was done and had been approved by the board of directors at both firms.
HP expected 3PAR technology to “bolster our ability to provide customers with the industry’s highest levels of performance, efficiency and reliability,” said Donatelli, manager of Enterprise Servers, Storage and Networking at HP.
“We intend to invest in 3PAR’s technology,” he said.
Dave Johnson, Dell’s senior vice president for corporate strategy, announced the Round Rock, Texas-based company’s decision to pull out of the bidding which began on Aug. 16 with an US$18 per share offer for 3PAR by Dell.
“We took a measured approach throughout the process and have decided to end these discussions,” Johnson said in a statement.
Dell dropped its attempt to acquire the Fremont, California-based 3PAR after HP topped its final offer of US$32 per share.
The 3PAR board of directors had recommended accepting an earlier offer from Dell, but decided to terminate their merger agreement and accept the “superior” offer from the Palo Alto, California-based HP.
Dell said it is entitled to receive a US$72 million break-up fee from 3PAR as a result of the company’s decision to go with the HP bid.
HP, the world’s largest computer manufacturer, and Dell, the third-largest, are both seeking to expand their offerings to include services and storage.
With the rise of Internet-based “cloud computing,” in which data is stored remotely, 3PAR was an attractive target and the bidding war for the company saw its stock triple in two weeks.
The acquisition of 3PAR gives HP an advantage in the market for advanced high-end data storage solutions, where 3PAR is the dominant player.
3PAR’s technology enables large companies and government agencies to shift to “cloud” storage platforms, significantly cutting storage costs.
Shares in 3PAR gained 2.49 percent on Wall Street on Thursday to close at US$32.88, while HP shares gained 1.2 percent to finish at US$39.68 and Dell shares gained US$1.98 to close at US$12.36.