3PAR finds HP's offer superior

Bidding war between Dell and HP ends with HP acquiring the suddenly hot storage company

Storage technology firm 3PAR confirmed late Friday that its board has accepted Hewlett-Packard's acqusition offer of $US30 per share, ending more than a week of competitive bidding with Dell.

The board of directors notified Dell that the HP offer met criteria as a "superior proposal" to Dell's $US27 per share bid, as defined in 3PAR's previous merger agreement with Dell. The board voted to immediately terminate the deal with Dell and enter into an agreement with HP, according to a 3PAR statement.

HP's board approved the offer on Friday.

3PAR is known for its "thin provisioning" technology, which allows storage resources to be provided on demand. It differs from traditional "fat provisioning," which allocates an excess amount of storage to an application in anticipation of future needs. Thin provisioning is much more efficient than the latter approach, which leads to underutilization of resources, advocates say.

Both HP and Dell see 3PAR's products as a key asset for building cloud computing environments.

The competition for 3PAR has been intense since Dell's initial offer of $1.15 billion on August 16. Analysts have chalked this up to the fact that there are few alternative, comparable acquisition targets.

The stakes were high for both companies but particularly Dell, which has already purchased "surrounding technologies" via the acquisitions of storage optimization provider Ocarina Networks and server provisioning vendor Scalent, said Andrew Reichman, a Forrester Research analyst.

"If they don't have an enterprise-class storage system, those are less valuable to them," he said. "They already bought the appetizers. Now they have to buy the entree."

HP sells similar technology, but through a partnership with Hitachi. Adding 3PAR will allow it to migrate those customers over, boosting margins.

However, HP's courtship of 3PAR could diminish the marketability of the Hitachi technology, according to Reichman said. HP has "kind of disparaged those products by saying they've needed [3PAR]," he said.

The bidding war's loser has other acquisition options, such as NetApp or EMC, but those would be far more expensive deals and involve "intense" integration challenges, Reichman said.

Overall, 3PAR customers shouldn't have much to worry about, according to Reichman. Enterprise storage buyers "are very conservative," and vendors therefore need to have many happy reference customers who can talk about their successes, he said. "Whoever gets it, they're going to want to treat the customers pretty well."

Contributing to this story were Chris Kanaracus and Peter Sayer.

Join the Good Gear Guide newsletter!

Error: Please check your email address.

Tags mergers & acquistionsHPbusiness issuesstorage marketDellHewlett-PackardTech industry

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

PC World Staff

PC World (US online)
Show Comments

Essentials

Lexar® JumpDrive® S57 USB 3.0 flash drive

Learn more >

Microsoft L5V-00027 Sculpt Ergonomic Keyboard Desktop

Learn more >

Mobile

Lexar® JumpDrive® S45 USB 3.0 flash drive 

Learn more >

Exec

Audio-Technica ATH-ANC70 Noise Cancelling Headphones

Learn more >

Lexar® JumpDrive® C20c USB Type-C flash drive 

Learn more >

Lexar® Professional 1800x microSDHC™/microSDXC™ UHS-II cards 

Learn more >

HD Pan/Tilt Wi-Fi Camera with Night Vision NC450

Learn more >

Budget

Back To Business Guide

Click for more ›

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre x360

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga 910

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Kathy Cassidy

STYLISTIC Q702

First impression on unpacking the Q702 test unit was the solid feel and clean, minimalist styling.

Anthony Grifoni

STYLISTIC Q572

For work use, Microsoft Word and Excel programs pre-installed on the device are adequate for preparing short documents.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?