New York: Tech giant Hewlett-Packard today said it will acquire Wi-Fi solutions provider Aruba Networks for an equity value of $3 billion to boost its networking business.
The move gives the US-based computer and enterprise solutions firm a stronger foothold in the over $18 billion campus networking solutions market.
The transaction is expected to close in the second half of HP's fiscal year 2015. The firm's fiscal year runs from November 1 to October 31.The company in a statement today said it will acquire Aruba for $24.67 per share in cash.
"Equity value of the transaction is approximately $3 billion and net of cash and debt approximately $2.7 billion. Both companies' boards of directors have approved the deal," it added.
Founded in 2002, California-based Aruba is in wireless networking solutions with around 1,800 employees. The company had revenues of $729 million in fiscal 2014 and has reported compounded annual growth revenue of 30 per cent over the last five years.
Aruba and HP believe, that by combining complementary product portfolios and go-to-market approaches, they will be able to accelerate revenue growth and strengthen the financial performance of the combined HP Networking business and create a leading competitor in the $18 billion and growing campus networking sector, HP said.
Overall, HP expects the acquisition to be accretive to earnings in the first full year following close. "This new combined organisation will be led by Aruba's Chief Executive Officer Dominic Orr and Chief Strategy and Technology Officer Keerti Melkote, reporting to Antonio Neri leader of HP Enterprise Group," HP said.
With this move, HP will be uniquely positioned to deliver, both innovation and global delivery and services offerings to meet customer needs worldwide, it added.
####Aruba and HP believe, that by combining they will be able to boost its networking business and create a leading competitor in the growing networking sector.
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