HP Acquires Aruba Networks to Bolster Wireless Networking Capabilities
It's the buzz of the technology world. Palo Alto-based Hewlett-Packard agreed to acquire Aruba Networks, a leading wireless networking solution provider, expanding HP's capabilities in the wireless networking space.
This is the biggest acquisition that HP has made since it acquired software firm Autonomy for nearly $ 12 billion in 2011. It also HP's first major transaction since it announced plans to split itself in two (Hewlett-Packard Enterprise and HP Inc.) last year.
The deal, which expected to close between May and October this year, is valued at $2.7 billion net of cash and debt.
The acquisition will enable HP to address an increasingly mobile business world by adding Aruba's strong wireless and mobility capabilities to its networking business. It also gives HP more ammunition to go after arch rival Cisco in the highly competitive WLAN (wireless local area network) market.
HP CEO Meg Whitman said in a statement on a deal: "Enterprises are facing a mobile-first world and are looking for solutions that help them transition legacy investments to the new style of IT. 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."
Founded in 2002 and based in Sunnyvale, California, Aruba is a networking company selling enterprise WLAN and edge access networking equipments. It makes Wi-Fi networking products such as access points, wireless controllers and software. It customers include China's biggest property developer Dalian Wanda Group, which uses the wireless technology in its shopping malls. Other customers include California State University and Qatar's Edzan Hotels & Suites.
Aruba will join the HP Enterprise Group, with Aruba CEO Dominic Orr and CTO Keerti Melkote staying on to lead the newly formed organization. They will be reporting to Antonio Neri, Head of HP Enterprise Group.
Aruba has 11.5 percent of the enterprise WLAN market, compared with HP 5.8 percent. While market leader Cisco Systems has 48.4 percent of the WLAN market, HP hopes that the Aruba acquisition would help it gain a little more market share.
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