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August 27, 2010 9:00 AM

Bidding Reaches $2B for 3PAR as HP Comes Back at Dell

Posted by Charlie Mead

Update, 8/27/10 at 11 a.m.: The offer/counteroffer volleys continue, and, as Bloomberg reports, HP has put forth a $2B offer to surpass the $1.8B bid Dell made late yesterday--and, as of 9 a.m. today, accepted by 3PAR's board (here's the Friday morning statement from Dell.) We'll update readers on where things stand at day's end. More from: The New York Times; Reuters; the San Jose Mercury News.

 

8/26/2010   - In the third round of bidding for data storage provider 3PAR Inc., Dell Inc. announced Thursday that 3PAR had accepted a revised $1.6 billion offer, topping Hewlett-Packard Company's earlier bid by 30 cents per share, The New York Times reports.

In a release announcing the accepted offer, Dell says it will pay $24.30 per share for 3PAR, more than $6 over the initial price of $18 per share.

As noted previously, Dell is being advised by Debevoise & Plimpton. Wilson Sonsinsi Goodrich & Rosati represents 3PAR, which was courted earlier this week by Palo Alto-based HP’s $24 per share offer. (Cleary Gottlieb Steen & Hamilton advised HP.)

Dell's newest bid values Fremont, Calif.-based 3PAR at eight times its revenue, Bloomberg reports, and may not signal an end to future offers. HP has almost $15 billion in cash, according to Bloomberg, and some analysts see a counteroffer on the horizon.

And Round Rock, Texas-based Dell may be content to simply match subsequent offers, rather than bump up any future bid by multiple dollars per share, according to The Wall Street Journal. The original Aug. 16 merger agreement between Dell and 3PAR gives Dell perpetual matching rights, reports the Journal.

The fight between Dell and HP follows moves by both companies to diversify their businesses away from PC manufacturing through steady acquisitions, The Wall Street Journal reports.

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