A bland data storage company has caused business wars between the world's two largest computer companies recently: Hewlett-Packard and Dell are paying more than each other to acquire a company called 3PAR. Industry sources said that the two computer companies are so fierce, first because they want to transform and expand software services, and second, data storage technology is essential to cloud computing.
In a bid to increase prices on August 16, Dell first announced the acquisition of 3PAR at a price of $18 per share. It did not expect its competitor Hewlett-Packard to “cross the bar,†and shouted a price of $24 per share. On the 26th, Dell made a bid of US$ 24.3 per share. 3PAR's board of directors agreed and submitted a report to the U.S. Securities and Exchange Commission. Seeing that the deal is about to be made, and not wanting to be in the evening, HP will raise the price again to $27 per share. The helpless Dell was forced to announce on the 27th and is ready to accept this price. However, after a few hours, HP again raised its price: 30 US dollars per share, and suddenly the total value of mergers and acquisitions reached 2 billion US dollars.
3PAR said on the 27th that it intends to terminate its initial agreement with Dell and “remarry†the attractive HP of the acquisition plan even though it means that it must pay Dell a lot of liquidated damages. Dell has not expressed its position yet. It will have several days to consider whether to increase the price. After two companies alternately bid, 3PAR's stock price has more than tripled from 9.65 US dollars two weeks ago, and led other stocks of data storage companies to rise.
Year after year, it has become a loss.
3PAR is a professional data storage company based in California and has suffered losses year after year since its listing in 2007. What charm does it have for HP and Dell to compete so hard to buy? Analysts pointed out that IT companies are now looking for new profit growth points. In particular, for hardware manufacturers, the rising cost of parts and components and the decline in retail prices have made their product profitability lower and lower. In the past five years, Hewlett-Packard has expanded its business into technical services, computer networks, and smart phones through strong mergers and acquisitions. Dell also acquired several software companies, but half of sales still come from computers.
Analysts at a New York financial company told Bloomberg News that enterprise data centers are one of the fastest growing areas. More and more companies are no longer buying equipment, but are using cloud computing services from large companies to handle them. Internal mail, ordering data and management information. Although 3PAR is not making money now, big companies can greatly increase their sales after mergers and acquisitions. Once the acquisition is successful, HP will have high-end storage products to provide enterprise customers with one-stop service of servers, storage and network equipment. Dell can make up for the gaps in its own business, instead of having to sell storage products for the company's rivals.
International Data Group's analysis believes that the acquisition of 3PAR can extend Dell's product line to provide cloud computing services to corporate customers. An analyst said that through the use of virtualization technology, Dell will transform into a provider of enterprise storage solutions. Another analyst said that 3PAR is one of the few data storage companies on the market that still maintains its independence. Whether Dell or Hewlett-Packard, their sales can easily double or even quadruple after the acquisition. This is why the two companies dared to increase prices again and again.
The top cow is still in the end. However, Gelsinger, president of the company, was somewhat dismissive of the deal. He said that although 3PAR is attractive, it will not bring too much profit to the new owner. Moreover, HP's current military turmoil, the former president and chief executive officer Hurd had just stepped down since the scandal in early August. Dell's days are even more saddened. Not long ago, one-fourth of its board of directors cast a vote of no confidence on CEO Michael Dell. Many analysts said that both Hewlett-Packard and Dell have accumulated large amounts of cash during the financial crisis. Now that the crisis has subsided, it is just waiting for an opportunity. Hewlett-Packard's funds are more abundant and it is expected to be the final winner. However, 3PAR's share price continued to soar after HP's bid. Obviously, investors believe that Hewlett-Packard and Dell are likely to go to the bottom.
In a bid to increase prices on August 16, Dell first announced the acquisition of 3PAR at a price of $18 per share. It did not expect its competitor Hewlett-Packard to “cross the bar,†and shouted a price of $24 per share. On the 26th, Dell made a bid of US$ 24.3 per share. 3PAR's board of directors agreed and submitted a report to the U.S. Securities and Exchange Commission. Seeing that the deal is about to be made, and not wanting to be in the evening, HP will raise the price again to $27 per share. The helpless Dell was forced to announce on the 27th and is ready to accept this price. However, after a few hours, HP again raised its price: 30 US dollars per share, and suddenly the total value of mergers and acquisitions reached 2 billion US dollars.
3PAR said on the 27th that it intends to terminate its initial agreement with Dell and “remarry†the attractive HP of the acquisition plan even though it means that it must pay Dell a lot of liquidated damages. Dell has not expressed its position yet. It will have several days to consider whether to increase the price. After two companies alternately bid, 3PAR's stock price has more than tripled from 9.65 US dollars two weeks ago, and led other stocks of data storage companies to rise.
Year after year, it has become a loss.
3PAR is a professional data storage company based in California and has suffered losses year after year since its listing in 2007. What charm does it have for HP and Dell to compete so hard to buy? Analysts pointed out that IT companies are now looking for new profit growth points. In particular, for hardware manufacturers, the rising cost of parts and components and the decline in retail prices have made their product profitability lower and lower. In the past five years, Hewlett-Packard has expanded its business into technical services, computer networks, and smart phones through strong mergers and acquisitions. Dell also acquired several software companies, but half of sales still come from computers.
Analysts at a New York financial company told Bloomberg News that enterprise data centers are one of the fastest growing areas. More and more companies are no longer buying equipment, but are using cloud computing services from large companies to handle them. Internal mail, ordering data and management information. Although 3PAR is not making money now, big companies can greatly increase their sales after mergers and acquisitions. Once the acquisition is successful, HP will have high-end storage products to provide enterprise customers with one-stop service of servers, storage and network equipment. Dell can make up for the gaps in its own business, instead of having to sell storage products for the company's rivals.
International Data Group's analysis believes that the acquisition of 3PAR can extend Dell's product line to provide cloud computing services to corporate customers. An analyst said that through the use of virtualization technology, Dell will transform into a provider of enterprise storage solutions. Another analyst said that 3PAR is one of the few data storage companies on the market that still maintains its independence. Whether Dell or Hewlett-Packard, their sales can easily double or even quadruple after the acquisition. This is why the two companies dared to increase prices again and again.
The top cow is still in the end. However, Gelsinger, president of the company, was somewhat dismissive of the deal. He said that although 3PAR is attractive, it will not bring too much profit to the new owner. Moreover, HP's current military turmoil, the former president and chief executive officer Hurd had just stepped down since the scandal in early August. Dell's days are even more saddened. Not long ago, one-fourth of its board of directors cast a vote of no confidence on CEO Michael Dell. Many analysts said that both Hewlett-Packard and Dell have accumulated large amounts of cash during the financial crisis. Now that the crisis has subsided, it is just waiting for an opportunity. Hewlett-Packard's funds are more abundant and it is expected to be the final winner. However, 3PAR's share price continued to soar after HP's bid. Obviously, investors believe that Hewlett-Packard and Dell are likely to go to the bottom.
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