“It looked like HP was willing to bid for this asset at any price,” says Shaw Wu, an analyst with Kaufman Bros. in San Francisco.“They way, way, way overpaid,” says Kaushik Roy, an analyst with Wedbush Securities in San Francisco. He adds ,”Everything has a price.”
These are a few comments that were made available after Hawlett-Packard made an offer to buy 3Par Inc. for about $2.3 billion. The Fremont, California-based 3Par produces hardware and software that helps companies to store information in a much easier and relatively inexpensive manner.
The offered price of $2.3 billion does not includes 3Par’s cash and near-term investments of about $104.3 million.
Dell and HP were in a battle since the last 18 days for this acquisition. Consequently, HP has managed to make the purchase. “We took a measured approach throughout the process and have decided to end these discussions,” is what Dave Johnson, Dell’s senior Vice President for corporate strategy, stated today.
HP increased its offer more than 3 times, than the closing price of $9.65 on Aug 13, after Dell made its initial bid public.
With this acquisition, HP’s goal is to compete with storage leaders like EMC. In addition to this, HP’s new deal is a display of its strength and capability which it wants to show after their Chief Executive Officer left, comments Aaron Rakers, an analyst at Stifel Nicolaus & Co. in St. Louis.
The value of $33 per share offered by HP is 325 times the earnings of 3Par calculated before interest, taxes, depreciation and amortization during the past year.
