Hewlett-Packard To Acquire Aruba Networks, Expanding Mobile Market Capabilities

Hewlett-Packard Co. (NYSE:HPQ) announced an agreement to acquire wireless-networking company Aruba Networks Inc. (NASDAQ:ARUN) in a deal valued at roughly $2.7 billion, expanding H-P’s capabilities in the mobile market.

H-P is offering $24.67 a share, a 1 percent discount to Aruba Network’s close on Friday, which was the highest level for the stock in almost two years amid rumors of a possible deal. The nearly $3 billion-valued deal includes cash and debt.

Meg Whitman, Chairman, President and Chief Executive Officer of HP, said the deal will combines Aruba’s wireless mobility solutions with H-P’s switching portfolio, allowing the company to offer most secure networking solutions to help enterprises easily deploy next-generation mobile networks.

“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 Ms. Whitman. “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.”

Aruba, a Sunnyvale-based industry leader in wireless networking, boasts roughly 1,800 employees and had revenues of $729 million in fiscal 2014. It has reported compound annual revenue growth of 30 percent over the last five years.

The H-P and Aruba operation will be led by Aruba Chief Executive Officer Dominic Orr and Chief Strategy and Technology Officer Keerti Melkote. They will report to Antonio Neri, head of H-P Enterprise Group.

“Together with HP, we have a tremendous opportunity to become an even greater force in enterprise mobility and networking,” said Mr. Orr. “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.”

Hewlett-Packard in October announced plans to separate its personal-computer and printer businesses from its corporate hardware and services operations, which has been sold as the growth engine.