HP Acquires Aruba Networks For £1.95 Billion

Hewlett-Packard has acquired Aruba Networks for around £1.95bn ($3bn), arming HP with a powerful wireless networking division.

Aruba and its 1,800 employees raked in revenues of $729m in 2014, and has reported a CAGR of 30 percent over the last five years.

The move went ahead for $24.67 per share in cash.  The equity value of the transaction is approximately £1.95 billion ($3bn), and net of cash and debt approximately $2.7 billion.

Innovation engine

HP said that the move was made because of Aruba’s “highly regarded innovation engine and specialised sales, marketing, and channel model”, with the acquisition complimenting HP’s go-to-market clout for its networking business.

“Enterprises are facing a mobile-first world and are looking for solutions that help them transition legacy investments to the new style of IT,” said Meg Whitman, chairman, president and CEO of HP.  “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.”

The buyout is a timely one, with last week’s earnings for HP showing a 10.8 percent slide year-on-year for networking hardware sales.

The acquisition is expected to close in the second half of HP’s fiscal 2015, where HP will split into two listed companies – HP Inc to head up printers and computers and HP Enterprise to look after corporate services.

Aruba CEO Dominic Orr said in a press release: “Together with HP, we have a tremendous opportunity to become an even greater force in enterprise mobility and networking.

“This transaction brings together Aruba’s best-of-breed mobility hardware and software solutions with HP’s leading switching portfolio.  In addition, Aruba’s channel partners will have the opportunity to expand their businesses with HP offerings.  Together, we will build on Aruba’s proven ‘customer first, customer last’ culture, creating an innovative, agile networking leader ideally positioned to solve our customers’ most pressing mobility, security and networking challenges.”

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Ben Sullivan

Ben covers web and technology giants such as Google, Amazon, and Microsoft and their impact on the cloud computing industry, whilst also writing about data centre players and their increasing importance in Europe. He also covers future technologies such as drones, aerospace, science, and the effect of technology on the environment.

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