HP raises the stakes in bidding war for 3Par
THE battle for a US data storage firm took two further twists yesterday as Hewlett Packard raised its offer for 3Par to $2 billion, once again topping Dell’s bid and showing it had plenty of ammunition in the bid war.
HP’s offer of $30 per share came less than three hours after Dell announced 3Par had accepted its bid of $27 per share which matched HP’s previous offer. Dell’s agreement with 3PAR allows it to match competing bids, but analysts say HP may be the stronger player with $115bn in annual revenue compared with Dell’s $53bn.
3PAR shares surged 20 percent to $31.29 in early trade. The bidding war has raised 3Par’s valuations to what some analysts see as unreasonable levels. Dell’s first public offer was $18 per share.
The rapidly escalating bids for 3PAR come as Dell, HP and other large technology vendors like IBM and Cisco Systems have been expanding into new technologies to offer corporate clients a wider range of products and services, including “cloud computing” – an increasingly popular technology that enables computer users to access data and software over the internet, allowing companies to cut costs.
August has been a particularly active month for deals. Intel bid $7.7bn for security software maker McAfee last week.
But analysts say the bidding war over 3Par has driven up valuations, raising the risk of the buyer overpaying. Analysts say at current bids, 3Par is valued at around eight times sales.