HP has proposed to acquire data storage company 3PAR for $24 per share in cash, or roughly $1.6 billion. Thus, it trumps Dell’s offer to buy out the company for $18 per share or $1.13 billion.The proposed transaction represents a 33.3 percent premium above the price proposed by Dell, is not subject to any financing contingency and has been approved by HP’s board of directors.
If and once approved by 3PAR’s board, HP expects the transaction to close by the end of the calendar year.
Update: in a webcast discussing the bid, HP acknowledged that it had made a previous offer for the company. HP’s David Donatelli, head of its Enterprise Servers, Storage and Networks division, said that HP had run due diligence on 3PAR and had already made an offer when the Dell bid was agreed.
3PAR provides a virtualized utility storage platform that enables customers to significant drive down cloud computing infrastructure, storage and associated management costs. The company was founded in 1999 and is headquartered in Fremont, California.
HP says the addition of 3PAR’s next-generation storage architecture would accelerate its Converged Infrastructure strategy, which provides customers with a portfolio of intellectual property across storage, server and networking solutions.
“HP’s proposal offers superior value to 3PAR’s shareholders. Our global reach, strong routes to market and commitment to innovation uniquely position HP as the ideal fit for 3PAR,” said Dave Donatelli, executive vice president and general manager, Enterprise Servers, Storage and Networking, HP.
The following is the full text of the letter HP sent to the 3PAR board regarding its offer:
August 23, 2010
Mr. David Scott
President and Chief Executive Officer
3PAR, Inc.
4209 Technology Drive
Fremont, CA 94538Dear David:
We are pleased to submit to you and your Board of Directors a proposal to acquire 3PAR, Inc., (“3PAR”) which is substantially superior to the Dell Inc. (“Dell”) transaction. We are very enthusiastic about the prospect of entering into a strategic transaction with 3PAR and believe that a business combination with HP will deliver significant benefits to your stockholders, customers, employees and partners.
We propose to increase our offer to acquire all of 3PAR outstanding common stock to $24.00 per share in cash. This offer represents a 33.3% premium to Dell’s offer price and is a “Superior Proposal” as defined in your merger agreement with Dell. HP’s proposal is not subject to any financing contingency. HP’s Board of Directors has approved this proposal, which is not subject to any additional internal approvals. If approved by your Board of Directors, we expect the transaction would close by the end of the calendar year.
In addition to the compelling value offered by our proposal, there are unparalleled strategic benefits to be gained by combining these two organizations. HP is uniquely positioned to capitalize on 3PAR’s next-generation storage technology by utilizing our global reach and superior routes to market to deliver 3PAR’s products to customers around the world. Together, we will accelerate our ability to offer unmatched levels of performance, efficiency and scalability to customers deploying cloud or scale-out environments, helping drive new growth for both companies.
As a Silicon Valley-based company, we share 3PAR’s passion for innovation. We have great respect for 3PAR’s management team and its employee base, and are excited about the prospect of working together going forward. Our long track record of acquiring companies and integrating them seamlessly into our organization gives us great confidence that this will be a successful combination.
We are including with this letter a draft merger agreement with the same terms as your announced transaction with Dell but which eliminates the termination fee.
We understand that you will first need to communicate this proposal and your Board’s determinations to Dell, but we are prepared to execute the merger agreement immediately following your termination of the Dell merger agreement. We also are prepared to commence a cash tender offer reflecting our higher price. Our tender offer would, of course, be conditioned upon your Board of Directors’ approval of a transaction with HP.
We look forward to making this opportunity a reality and consummating a mutually beneficial transaction.
Sincerely,
Shane Robison
Executive Vice President and Chief Strategy and Technology Officer
HP
| Website: | 3par.com |
| Location: | Fremont, California, United States |
| Acquired: | August 16, 2010 by Dell for $1.15B |
3PAR Inc. is a global provider of utility storage systems for mid-sized to large enterprises, financial services firms, cloud computing service providers, consumer-oriented Internet/Web 2.0 companies, and government entities. The Company helps… Learn More
| Website: | hp.com |
| Location: | Palo Alto, California, United States |
Hewlett-Packard Company (NYSE: HPQ), commonly referred to as HP, is an American multinational information technology corporation headquartered in Palo Alto, California, USA. HP is one of the world’s largest information technology companies and… Learn More
| Website: | dell.com |
| Location: | Round Rock , Texas, United States |
| Founded: | 1984 |
Dell develops, manufactures, and sells personal computers and other computer-related products including servers, data storage devices, network switches, software, computer peripherals and televisions. Learn More
6fusion, a fledgling company that has developed a system to take control of third party computing resources, this morning announced that it has raised a $3 million round of venture capital financing. In addition, the startup announced it has relocated to the Research Triangle region of North Carolina.
The $3 million Series A round was led by Intersouth Partners, and will be used to add to its senior executive team and expand research and development.
6fusion says it has developed an algorithm that significantly simplifies the metering, consumption and billing of compute resources, called the Workload Allocation Cube (WAC).
The company has also developed a platform called UC6, which provides a single pane-of-glass user interface for customers to dynamically provision cloud workloads internal or external to their organization.
Katrin Burt and Mitch Mumma of Intersouth will join the company’s board of directors.
| Website: | 6fusion.com |
| Funding: | $3M |
6fusion is a new venture created by a group of IT professionals to help other IT and telecommunications service providers enter and adapt to the new and profitable world of managed or hosted technology services by co-creating value and providing a… Learn More
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