Thursday, September 02, 2010

Dell pulls out of 3Par bidding madness, HP wins. Who could Dell buy next?

It is officially over today when HP raised its offer to $33 per share or $2.1. billion for money loosing 3Par and Dell decided to quite the bidding war madness. This marks an outrageously high premium deal on HP's side which woul not have happened under Mark Hurd.  He was a disciplined dealmaker with a keen focus on delivering shareholder value.

"We took a measured approach throughout the process and have decided to end these discussions," said Dave Johnson, Dell's senior vice president for corporate strategy. Dell will receive a $72 million breakup fee from 3PAR. Enterprise sevices, storage and cloud services are key to both HP and Dell as they try to mimic IBM’s strategy and become one-stop shops for large customers’ technology need. HP overpaid for 3Par because they wanted to block Dell's thrust into enterprise storage.

On Monday we wrote a blog post that offered lessons to dealmakers from this mad contest between two high-tech titans. We do not expect Dell to quitely pull out, but rather refocus its M&A funds at other leading storage and software companies to desperately build out enterprise services. Compellent Technologies would be the next logical choice after 3Par.
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