HP to acquire 3Com for $2.7 billion

Bengaluru: HP and 3Com Corporation announced that they have entered into a definitive agreement under which HP will purchase 3Com at a price of $7.90 per share in cash or an enterprise value of approximately $2.7 billion. The terms of the transaction have been approved by the HP and 3Com boards of directors.

"Companies are looking for ways to break free from the business limitations imposed by a networking paradigm that has been dominated by a single vendor," said Dave Donatelli, Executive VP and GM-Enterprise Servers and Networking, HP. "By acquiring 3Com, we are accelerating the execution of our Converged Infrastructure strategy and bringing disruptive change to the networking industry. By combining HP ProCurve offerings with 3Com's extensive set of solutions, we will enable customers to build a next-generation network infrastructure that supports customer needs from the edge of the network to the heart of the data center," he added.

"Our extensive product line and innovative technology together with HP's breadth and scale will expand our global opportunity," said Bob Mao, CEO, 3Com. "3Com's networking products are based on a modern architecture which has been designed to offer better performance, require less power and eliminate administrative complexity when compared against current network offerings. Our products are enterprise proven and widely deployed in the world's largest banks, manufacturers, Internet service providers, public utilities and retailers," he added.

Under the terms of the merger agreement, 3Com stockholders will receive $7.90 for each share of 3Com common stock that they hold at the closing of the merger. The acquisition is subject to customary closing conditions, including the receipt of domestic and foreign regulatory approvals and the approval of 3Com's stockholders. The transaction is expected to close in the first half of calendar 2010. HP anticipates that the transaction will be slightly dilutive to fiscal 2010 non-GAAP earnings.