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HP to Buy Wi-Fi Equipment Maker Aruba Networks for About $3 Billion
By MICHAEL J. de la MERCEDMARCH 2, 2015
Hewlett-Packard agreed on Monday to buy Aruba Networks, a maker of Wi-Fi access equipment for businesses, for about $3 billion in HP’s biggest deal in more than three years.
The deal would also be the first major transaction by the technology company since it announced plans to split itself in two last year.
Under the terms of the agreement, HP will pay $24.67 a share in cash. That represents a roughly 34 percent premium to Aruba’s closing price on Feb. 24, the day before Bloomberg News reported the merger discussions between the two.
Buying Aruba would bolster HP’s networking business as smartphones, tablets and other connected devices continue to proliferate. Aruba, a 13-year-old networking equipment maker, specializes in wireless networking access point hardware and software, which are used by hotels, universities and shopping malls.
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The company reported $728.9 million in revenue in its fiscal year that ended July 31, up nearly 22 percent from the prior year. Its net loss narrowed during the same time, to $29 million.
”Enterprises are facing a mobile-first world and are looking for solutions that help them transition legacy investments to the new style of I.T.,” Meg Whitman, HP’s chairman and chief executive, said in a statement. “By combining Aruba’s world-class wireless mobility solutions with HP’s leading switching portfolio, HP will offer the simplest, most secure networking solutions to help enterprises easily deploy next-generation mobile networks.”
HP expects the deal to add to its earnings in the first full year after closing.
Aruba will continue to do business under its own brand and will be led by its chief executive, Dominic Orr. Mr. Orr will report to the head of HP’s enterprise group, Antonio Neri.
The deal is expected to close by Oct. 31, pending approval by regulators and Aruba’s shareholders.
Evercore served as financial advisor on the deal to Aruba.
By MICHAEL J. de la MERCEDMARCH 2, 2015
Hewlett-Packard agreed on Monday to buy Aruba Networks, a maker of Wi-Fi access equipment for businesses, for about $3 billion in HP’s biggest deal in more than three years.
The deal would also be the first major transaction by the technology company since it announced plans to split itself in two last year.
Under the terms of the agreement, HP will pay $24.67 a share in cash. That represents a roughly 34 percent premium to Aruba’s closing price on Feb. 24, the day before Bloomberg News reported the merger discussions between the two.
Buying Aruba would bolster HP’s networking business as smartphones, tablets and other connected devices continue to proliferate. Aruba, a 13-year-old networking equipment maker, specializes in wireless networking access point hardware and software, which are used by hotels, universities and shopping malls.
Continue reading the main story
Related Coverage
The HP Sprout PC on display at the International CES last month in Las Vegas.
HP Earnings Decline 4%, and Outlook Is Lowered
The company reported $728.9 million in revenue in its fiscal year that ended July 31, up nearly 22 percent from the prior year. Its net loss narrowed during the same time, to $29 million.
”Enterprises are facing a mobile-first world and are looking for solutions that help them transition legacy investments to the new style of I.T.,” Meg Whitman, HP’s chairman and chief executive, said in a statement. “By combining Aruba’s world-class wireless mobility solutions with HP’s leading switching portfolio, HP will offer the simplest, most secure networking solutions to help enterprises easily deploy next-generation mobile networks.”
HP expects the deal to add to its earnings in the first full year after closing.
Aruba will continue to do business under its own brand and will be led by its chief executive, Dominic Orr. Mr. Orr will report to the head of HP’s enterprise group, Antonio Neri.
The deal is expected to close by Oct. 31, pending approval by regulators and Aruba’s shareholders.
Evercore served as financial advisor on the deal to Aruba.
