Dell tops HP's bid for 3PAR, HP buys Stratavia to mask the pain; Update: HP re-ups bid; Updated x3 | webOS Nation
 
 

Dell tops HP's bid for 3PAR, HP buys Stratavia to mask the pain; Update: HP re-ups bid; Updated x3 52

by Derek Kessler Fri, 27 Aug 2010 12:34 pm EDT

Dell buys 3PAR

After HP upped the ante by $500 million, all eyes turned to Dell in the surprise bidding war for cloud storage firm 3PAR. With both tech giants looking to continue the aggressive expansion of their respective enterprise services divisions, an acquisition like 3PAR would add significant assets to their portfolios. Alas, for HP there were not wedding bells to be heard, as Dell would have nothing of this raised bid and submitted a counter-offer to top HP’s.

From the looks of things, that’s good enough for 3PAR, as the 3PAR board has formally accepted Dell’s $1.52 billion bid. Granted, Dell didn’t raise the stakes as much as HP did during the last round, but $1.52 billion is more cash than $1.5 billion, and in this game more dollars wins.

To sooth the sting of the love lost, HP instead announced that they were buying Denver-based database and application automation company Stratavia for an undisclosed wad of cash. Stratavia will become part of HP’s Software and Solutions division and will help the company improve their time-to-market for software systems development. The company’s assets will also be leverage to enhance HP’s cloud computing and storage systems, with Stratavia’s database and application packaging automation solutions serving to accelerate delivery to customers. Alas, ‘tis better to have loved and lost, than never to have loved at all.

Source: New York Times, MarketWatch; Thanks to everybody that sent this in!

Update: HP just announced that they have revised their proposal up to $1.8 billion dollars, or $27.00 per share. They're not fooling around, as they note in their press release:

The proposal represents an 11 percent premium above the most recent price offered by Dell Inc. of $24.30 per share. HP’s proposal is not subject to any financing contingency and has been approved by HP’s board of directors

Update 2: Dell went ahead and matched HP's offer and 3Par accepted. No word if HP will try to jump in again. Thanks to everybody who sent this in!

Update 3: ...and HP has re-upped their bid again, this time to $30 per share, or $2 billion. Gotta say, we're with @foxycar on this one.

52 Comments

Wow. Pocket change for HP. Someone on that board didn't want to be a part of HP.

how bout HP doesn't buy anything and splits the 1.8 billion between all PRE users. I'm ready to send in my bank account #

First!!!

I agree that first post comments are stupid but had to do it anyway. :-P

signed in just to say this; you're an idiot

So did I... And I agree with you

Well, that's disappointing for HP.

Stratavia (http://www.stratavia.com/) looks like a substantial company with a good portfolio of application stack automation for physical, virtual, and cloud infrastructure products. I will also bet that it was a lot cheaper than 3PAR. So HP ends up with a cloud database enablement company and cash in their pocket. Sweet!

What HP has done is force Dell to increase their initial bid by 35%, from $18/sh to $24.30/sh. A major win for 3Par shareholders & costs a competitor of HP's a lot more money.

BTW, no where in any of the articles I have read does it say the deal is done even though the board of 3Par accepted this bid. They also accepted the Dell bid at $18/sh. The bid by HP was unsolicited. Has HP said they were done bidding? They may well be, but I haven't seen that in an article.

I'm sure they are done bidding having, as you said, cost a rival a lot of money. HP are probably considering this a win. 3Par is an eternal money looser.

>>>3Par is an eternal money looser

well done palm
seems more like they where aware that the board preferd dell :)
and they just boosted the money dell would have to pay for it...hp already had plan b in the pocket...
in one to two years hp will buy dell you will see :)
and hopefully sprint too :)

Thought of HP buying sprint.. interesting.. WebOS being pushed hard by a carrier, like the android is being pushed hard by verizon.. it could definitly help get webos out there, because right now store reps kill it for webos.. they are either unknowledgable about webos or android fan boys..

:(

I do love the graphics.

Seriously, Derek, if you haven't already, talk to Engadget about taking over the graphics there. You've far surpassed them by now.

Good show, ol' bean!

As others have said, I love the graphic.

Loved that graphic, too. It's perfect!

So 3PAR, whom I've never heard of, is worth $1.52 billion and Palm, hard on its luck but a legend in its industry, was only worth $1.2 billion. 3PAR's been around for a full decade and trades on the NYSE, but it still seems weird.

It's all about the books.

Palm had an enormous amount of liabilities and not many assets if I am not mistaken.

3PAR also seems to have played the stock game pretty well (treasury stock is probably the reason). Their market cap is 1.62B (what they're worth according to their stock).

I guess it's just a matter of time before we hear about a guy from Stratavia who is tweeting about how much he loves his new webOS device and looks forward to developing productivity and cloud-based apps.

i think hp let them win the battle. they could of easily won that bid. i think in the near future, if dell keep bidding that high, they could run out of money and possibly be acquire by hp. we just never know.

Is Stratavia very similar to 3par? If so, Dell just got owned with the bidding war because I bet HP bought Stratavia for cheap since it wasn't a war.

BREAKING UPDATE HP has not given up on 3PAR. Just re-bid at $27/share.

Looks like HP wants this one.

Should that update read $1.8 Billion?

Can't get Dr. Evil out of my mind...

Yeah, I think he dropped some 0s.

Time to ante up and come correct!

HP throwing its weight around, good to see. It'll be interesting to see how this translates to their mobile ecosystem.

Damn, HP throwing that bread around!

Hey Dell... Can't touch this!

/queue music (Ante Up by M.O.P)

"...Ante-up! Slap that fool! ...Ante-up! Jack that fool!"

/end music

HP is goin "Big Balla" style throwin big wads of cash on the table to make Dell "man up"! Lol.

I'd LOVE to see HP duke it out with crApple since HP's bank account could crush Stevies. =)

song: http://bit.ly/a2rDJX

sry triple

sry double

hp pls let the deal drop invest this money into palm...
seems like hp only likes buying toys but never plays with them...

never heard of this comp why should they be more worth then palm...

do they have tons of patents like palm has?

hp is playing a game of death and life all we want is new palmssssss like many new palms....

I hope this and other recent acquisitions bodes well in favor of our beloved (Palm) webOS. Hopefully this is to expand cloud service that will benefit upcoming webOS devices. Here is hoping it's so.

Im of two minds about cloud storage. I hope it doesn't mean they skimp on hardware storage. Despite the best efforts of carriers I know I wont have 3G, 4G and or Wifi everywhere, so the idea of keeping most of my media in the clouds and streaming to my device horrifies me a bit. Just my random thought of the hour.

If I set my phone to just count 1,2,3,... the battery would die before it got to 1.8 Bil. What the heck! that's alot of money for hard drives.

As I have said from the beginning, until one of the companies pulls out of the bidding, it continues. None of the articles has so stated at this point. A couple things to note:

1) 3Par's Board has been working w/Dell to shape this deal & trusts them. This is obvious due to the $18 initial bid by Dell & their 2nd bid that was only 30 cents/share (1.25%) above that of HP. 3Par's board gave Dell 3 days to respond to HP's initial offer, yet immediately accepted Dell's 2nd bid which was only marginally higher than that of HP.

2) HP's bid is hostile/unsolicited. That is why they are coming in so much higher than Dell's bid & offering all cash. It is so much higher (33% 1st bid & 11% higher w/the 2nd bid). It is a high enough bid that 3Par's board cannot ignore it & would have to send it to shareholders if Dell doesn't up their ante--again.

3) HP is being very aggressive against a competitor--all without a CEO. It wouldn't surprise me if this strategy was developed prior to Hurd's resignation.

Here is a link to a very good Wall St Journal article talking about the fight for 3Par, why it is important & why both companies are willing to spend so much money.

http://online.wsj.com/article/SB1000142405274870395970457545322359176740...

Sounds like Dell won in the end. Well, at least that's what Dell is saying:

http://www.reuters.com/article/idUS42583524720100826

Ummm.... no.... that Reuters article was not up to date. HP's counter-bid was post-Reuters.

Outside of the initial HP purchase of Palm, this is probably the most interested I've ever been in a bidding war.

Yes, I know it wasn't a "war" when HP bought Palm, but afterward they released the details on all the other companies that put up bids, and it seemed like HP was REALLY intent on getting their hands on Palm from the get-go.

HP just bidded again and went up to 30 per share.

I guess we can now call this a war.

HP is dead-set on winning this takeover because it has to be part of a strategy that probably started with Palm. Whoever said that Sprint might be next is making a very solid guess. It gives HP control of every asset from manufacturing to consumer to content provider, very much like Apple except Apple doesn't own AT&T.

Or do they??????

I've heard that HP has deep pockets but after seeing all these acquisitions I really believe it. These guys are brewing up something big. I can't wait to see it.

Although HP is an enormous company with tons of spending money, there is almost no chance it will ever buy Sprint. When HP asserts itself as a major player in the smartphone market, buying Sprint will only limit its customer base. Other carriers will be unwilling to buy products from a direct competitor, and Sprint has a small subscriber pool when compared to Verizon and AT&T, so HP would be limiting its future smartphone customer base to a minority of the market. The opportunity cost of not being able to sell to these customers would negate the additional profits from "controlling every asset from manufacturing to consumer to content provider." Also, Sprint has recently incurred a great deal of debt in establishing its 4G network ahead of every other carrier. I believe 3par is a strategic purchase. HP wants to bar Dell from the enterprise storage market, while gaining a company in line with its "simplicity" slogan for cloud storage.

Judging by how quickly Dell and HP have responded to one another thus far, and because there are so few other options in this price range, I predict this bidding war will end at $2.4 billion, or just over double Dell's original asking price. If Dell can match this price, I doubt HP will continue.

update 4 :

HP buys Dell....
drops bid for 3par to 750 million... And all remaining pre inventory... To make room for roadrunner

Here is an article questioning if HP has taken this too far & wondering why they would bid so much w/o a CEO in place. The article contends that a company making less than $200m in revenue/yr may not be worth $2B. if it is, they say the companies are looking long term.

http://eresearch.fidelity.com/eresearch/goto/evaluate/news/basicNewsStor...

the reason it maybe worth 2billion

http://bit.ly/aIttRB