Dell/HP/3par, Another EMC/NetApp/Data Domain Story
Dell reacts at $1.6 billion, then HP and once more Dell at $1.8 billion.
This is a Press Release edited by StorageNewsletter.com on August 27, 2010 at 3:21 pmFollowing are the three latest press releases
concerning the acquisition of 3par:
3PAR, Inc. has accepted an increased offer to be acquired by Dell for a price of $24.30 per share,
or approximately $1.6 billion, net of 3PAR’s cash.
3PAR Inc. and Dell Inc. have signed an amendment to their previously announced merger agreement reflecting the new offer price and a revised termination fee of $72 million, which is payable in the event that 3PAR receives and accepts another unsolicited acquisition proposal that its board determines to be superior to Dell’s increased offer.
Dell’s desire for 3PAR is driven, in part, by its belief that 3PAR, with its architecturally superior utility storage solution, is important to Dell’s customers and will enhance its position in cloud-based storage applications. 3PAR’s multi-tenant, clustered architecture enables IT organizations to deliver software and hardware as a service, offering an agile, efficient storage infrastructure platform optimized for highly-virtualized data centers and cloud computing. Additionally, with its global reach, Dell believes it will be able to drive greater deployment and penetration of 3PAR’s products, accelerating Dell’s momentum in delivering open, capable and affordable storage options.
The cash tender offer commenced on August 23, 2010 by Dell, through a wholly-owned subsidiary, is for all outstanding shares of 3PAR common stock, without interest, and subject to reduction for any federal back-up withholding or other taxes. The offer documents will be amended to reflect the new offer price, but this will not alter the timing of the acquisition. Unless extended, the tender offer and any withdrawal rights to which 3PAR stockholders may be entitled will expire at midnight, EDT, on Sept. 20, 2010. Following acceptance for payment of shares in the tender offer and completion of the transactions contemplated in the merger agreement, 3PAR would become a wholly-owned subsidiary of Dell.
The board of directors of 3PAR continues to unanimously recommend that 3PAR stockholders accept Dell’s tender offer and tender their shares in the offer.
HP announces revised proposal to acquire 3PAR
for $27 per share in cash
Hewlett-Packard Development Company, L.P. has increased its proposal to acquire all of the outstanding shares of 3PAR Inc. to $27.00 per share in cash, or an enterprise value of $1.8 billion.
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. Once approved by 3PAR’s board, HP expects the transaction to close by the end of the calendar year.
“Our revised proposal offers superior value to 3PAR’s shareholders, while maintaining our disciplined approach to only pursuing acquisitions that we believe will strengthen our portfolio and create long-term value for our shareholders,” said Dave Donatelli, executive vice president and general manager, Enterprise Servers, Storage and Networking, HP. “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.”
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. The combination will bolster HP’s storage offerings and diversify its portfolio across key growth markets.
3PAR accepts matching acquisition offer by Dell
Revised transaction valued at approximately $1.8 Billion
3PAR, Inc. has accepted a matching offer to be acquired by Dell Inc. for a price of $27 per share, or approximately $1.8 billion, net of 3PAR’s cash. Accordingly, 3PAR and Dell have signed a second amendment to their previously announced merger agreement reflecting the new offer price, and maintaining the termination fee unchanged at $72 million, which is payable in the event that 3PAR receives and accepts another unsolicited acquisition proposal that its board determines to be superior to Dell’s increased offer.
The cash tender offer commenced on August 23, 2010 by Dell, through a wholly-owned subsidiary, is for all outstanding shares of 3PAR common stock, without interest, and subject to reduction for any federal back-up withholding or other taxes. The offer documents will be amended to reflect the new offer price, but this will not alter the timing of the acquisition. Unless extended, the tender offer and any withdrawal rights to which 3PAR stockholders may be entitled will expire at midnight, EDT, on Sept. 20, 2010. Following acceptance for payment of shares in the tender offer and completion of the transactions contemplated in the merger agreement, 3PAR would become a wholly-owned subsidiary of Dell.
The board of directors of 3PAR continues to unanimously recommend that 3PAR stockholders accept Dell’s tender offer and tender their shares in such offer.
Comments
THE FACTS IN ORDER:
- Dell to buy 3par for $1.15 Billion at $18 per share
- Now It's the war between Dell and HP: HP has submitted to 3Par a proposal to acquire all of the outstanding shares of 3par for $24.00 per share in cash, or an enterprise value of $1.5 billion.
- 3par has accepted an increased offer to be acquired by Dell for a price of $24.30 per share, or approximately $1.6 billion. They did their agreement to make it slightly more painful for 3Par to accept another offer, with a termination fee of $72 million it would pay to Dell rather than $53.5 million before.
- HP announces revised proposal to acquire 3par for $27 per share in cash or an enterprise value of $1.8 billion, an offer once more matched by Dell.
OUR OPINION:
This story looks like what happens between EMC and NetApp to acquire Data Domain. NetApp was the first to make an offer and finally was the loser. The price began at $1.5 billion to finish at $2.1 billion. Here Dell began at $1.15 billion and the last offer of HP is at $1.8 billion.
Will Dell bid once more for higher price? It's possible as it's a war between the two giants, not only to buy 3par but to oblige their main computer competitor to pay more to get the start-up.
Dell retains the right to come back with a higher offer within three days. Both companies have enough cash to go further.
It's strange to see the deep silence of mainly EMC, but also NetApp, HDS or IBM, to this bidding as they also don't have subsystems with the quality of 3Par's design.
3par has just accepted latest Dell's offering at $1.8 billion but be sure that it will change its mind if HP bids for an higher price in the next days.
Both companies want 3par because its subsystems is based on new storage architecture and not old one like EVA or EMC Symmetrix, and its number of customers prove its value and its success. But we think that $1.8 billion is already too much for such a company. The happy man here is David Scott, 3Par's CEO, and the shareholders of the company.
We also think that, at the same price, 3par employees will prefer Dell rather than HP. Dell has no R&D team in high-end storage subsystems, reselling EMC and having a separate team for EqualLogic, not directly in competition with 3par's offering. At HP, you can bet that StorageWorks and EVA engineers are surely not happy to see an external storage R&D team joining them with innovative ideas to design storage products.
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