HP in $2.7bn deal to buy 3Com
The world’s largest computer maker, Hewlett-Packard (HP), has announced it is to buy networking software and equipment maker, 3Com Corp, in a deal worth $2.7 billion (£1.6 billion), subject to regulatory approval.
The deal will see HP compete across the board with networking leader Cisco Systems Inc.
The deal, which is expected to be finalised in the first half of next year, will allow San Jose-based HP to combine servers, storage, networking, management and services.
Last August, HP purchased Electronic Data Systems Corporation (EDS), which at the time created a leading force in technology services.
Meanwhile, HP has posted its preliminary quarterly profits, which have exceeded analysts’ expectations.
Commenting on the deal, chief executive Mark Hurd said: “Solid execution drove exceptional performance for HP this quarter, fuelled by significant growth in China.”
According to analysts, the deal with 3Com will help the company enhance its presence in the rapidly growing Chinese market.
3Com, which has 5,800 employees worldwide and is based in Marlborough, Massachusetts, has more than half of its revenue coming from China.
HP, which is shedding almost 25,000 jobs as part of the EDS acquisition, did not confirm whether there would be redundancies as a result of its acquisition of 3Com.
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