A visitor takes a photo with a tablet in front of a Hewlett-Packard (HP) stand at the Mobile World Congress in Barcelona, February 27, 2014.
Credit: /Albert Gea
- Hewlett-Packard Co said it would buy Wi-Fi network gear maker Aruba Networks Inc for about $2.7 billion, the biggest deal for the world's No. 2 PC maker since its botched acquisition of Britain's Autonomy Plc in 2011.
HP has had a dismal record for big acquisitions, having written off multibillion-dollar acquisitions of Autonomy and technology outsourcing provider EDS, which it bought in 2008.
With the purchase of Aruba, HP is boosting its share of the wireless local area network (WLAN) market as more companies allow employees to access work systems through their wireless devices.
HP has a 4-5 percent share of the enterprise WLAN market, compared with Aruba's 10-13 percent, FBN Capital Markets analyst Shebly Seyrafi estimated in a note dated Feb. 27.
The all-cash offer of $24.67 per share is a premium of 34.4 percent to Aruba's close on Feb. 24, the day before Bloomberg reported that a deal was in the works.
Aruba shares fell 1.45 percent to $24.44 in morning trading on Monday. The stock had risen about 40 percent since the Bloomberg report. HP shares were up less than 1 percent at $34.88.
HP, which has struggled to adapt to the new era of mobile and online computing, plans to split into two listed companies this year, separating its computer and printer businesses from its corporate hardware and services operations.
HP's cash pile stood at $12.9 billion at the end of January.
Evercore served as financial adviser to Aruba.
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