HP Raises 3PAR Offer To $2 Bn, Trumps Dell Again

Hewlett-Packard Co raised its offer for 3PAR to $2 billion, once again topping Dell Inc’s bid and showing it had plenty of ammunition in a bidding war for the data storage company. HP’s offer on Friday of $30 per share was the latest in a week-long volley of escalating bids, and came less than 3 hours after Dell announced 3PAR had accepted its bid of $27 per share, which matched HP’s previous offer.

Analysts say HP may be the stronger bidder with $115 billion in annual revenue compared with Dell’s $53 billion, and a more global sales force that could help 3PAR grow faster. HP’s bids have also been bolder, while Dell has mostly moved to match its rival.

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Dell’s prior agreement with 3PAR, however, allows it to match competing bids, and the company said it was assessing the latest move, which has raised 3PAR’s valuations to what some analysts see as unreasonable levels. “We’ll act in the best interest of our customers and our shareholders, and the long-term value creation for both,” said David Frink, spokesperson, Dell.

3PAR shares closed 24.7 percent higher at $32.46, indicating investors expect an even higher bid to emerge. The shares had mostly traded around $10 this year, until Dell announced its $18 per share bid earlier this month.

If it wins, HP would also need to pay the breakup fee of $72 million that is part of the Dell-3PAR deal. HP said that once the deal is accepted by 3PAR, it will close by the end of the year.