Bidding war for 3PAR heats up

HP offers $1.8 billion for utility storage provider, topping Dell's $1.6 billion proposal

For the big hardware makers, storage is the next frontier. And, both Dell and HP are willing to pay up. 

HP announced Thursday that it has upped its offer to purchase 3PAR, a provider of virtual storage solutions, to $27 per share, or roughly $1.8 billion, which is an 11-percent premium above Dell's $24.30-per-share offer, which Dell announced Thursday morning was a done deal. 

How’s that for a little melodrama to liven up your Thursday?

3PAR has not yet released a statement about HP’s most recent offer, but when asked if the company would take up HP on its $1.8 billion offer, 3PAR spokesperson John D'Avolio only told me: "Our board of directors is aware of and reviewing HP's offer." 

Hot commodity

Fremont, Calif.-based 3PAR is quite the hot commodity in the cloud industry, with seven of the top 10 Infrastructure-as-a-Service (IAAS) customers as clients. Among its selling points, the company lists:

1)      The ability to service a wide range of applications from multiple servers simultaneously

2)      Efficiency, through the innovative use of thin storage technologies

3)      Giving system administrators the freedom to make changes quickly and efficiently

Another would be 3PAR’s seemingly modest assessment of itself as evident in its self-effacing blog. According to the blog, “We’ve been very successful with our cloud strategy… 3PAR works very hard in the background for a lot of household-name customers...[but] most people don’t know or care.” 

But clearly, Dell and HP do. The question is: How much?

Apparently, enough for Dell to consider whether to match the offer.

“Our agreement with 3PAR gives us the right and a period of time to match any new offer. We’ll take some time, assess the situation and act in the best interests of our customers and shareholders. We’ll make a comment regarding our next step (or plans) at an appropriate time," said Dell spokesperson David Frink, via email when asked whether or not Dell would make a higher offer.

In explaining what 3PAR would bring to Dell, senior vice president of Dell’s corporate strategy, Dave Johnson, noted in the company’s press release that “storage is at the forefront of this strategy… With the 3PAR acquisition, Dell will have the broadest set of differentiated storage solutions in the market today.”

As for what's behind HP's interest?

HP’s most recent press release also highlights the benefits that would come its way with the acquisition of 3PAR:

“The addition of 3PAR’s next-generation storage architecture will accelerate HP’s Converged Infrastructure strategy, providing customers with an unmatched portfolio of intellectual property across storage, server and networking solutions. 3PAR’s high-performance storage systems will further strengthen HP’s ability to deliver the highest levels of performance, efficiency and scalability to customers worldwide.”

Commenting on HP’s revised proposal to 3PAR, which represents an 11-percent premium over that offered by Dell, HP’s executive vice president and general manager Dave Donatelli remarks: “Not only is our offer superior to Dell’s proposal, HP remains uniquely positioned to execute on this combination given the number of synergies between the two companies.”

How will it end?

Earlier this month, Dell offered $18 per share to acquire 3PAR, with a provision for matching competing bids.  HP followed up with a higher bid of $24 per share, or $1.6 billion, which Dell saw and raised to $24.30 per share.

And, then there's the current offer of $27. Do I hear $30? 

Image source: thehindu.com