HP (NYSE: HPQ) and 3Com Corporation (NASDAQ: COMS) (“3Com”)
today announced that they have entered into a definitive agreement
under which HP will purchase 3Com, a leading provider of networking
switching, routing and security solutions, at a price of $7.90 per
share in cash or an enterprise value of approximately $2.7 billion.
The terms of the transaction have been approved by the HP and 3Com
boards of directors.
This combination will transform the networking industry and
underscore HP’s next-generation data center strategy built on the
convergence of servers, storage, networking, management, facilities
and services. The resulting business outcome will help customers
simplify the network, deploy a unique and innovative edge-to-core
network fabric for the enterprise and improve IT service delivery
capabilities, all delivered with best-in-class
price-performance.
“Companies are looking for ways to break free from the business
limitations imposed by a networking paradigm that has been
dominated by a single vendor,” said Dave Donatelli, executive vice
president and general manager, Enterprise Servers and Networking,
HP. “By acquiring 3Com, we are accelerating the execution of our
Converged Infrastructure strategy and bringing disruptive change to
the networking industry. By combining HP ProCurve offerings with
3Com’s extensive set of solutions, we will enable customers to
build a next-generation network infrastructure that supports
customer needs from the edge of the network to the heart of the
data center.”
“Our extensive product line and innovative technology together
with HP’s breadth and scale will expand our global opportunity,”
said Bob Mao, chief executive officer, 3Com. “3Com’s networking
products are based on a modern architecture which has been designed
to offer better performance, require less power and eliminate
administrative complexity when compared against current network
offerings. Our products are enterprise proven and widely deployed
in the world’s largest banks, manufacturers, Internet service
providers, public utilities and retailers.”
The acquisition of 3Com will dramatically expand HP’s Ethernet
switching offerings, add routing solutions and significantly
strengthen the company’s position in China – one of the world’s
fastest-growing markets – via the H3C offerings. In addition, the
combination will add a large and talented research and development
team in China that will drive the acceleration of innovations to
HP’s networking solutions.
3Com also brings to HP best-of-breed network security
capabilities through its TippingPoint portfolio. For the past four
years, TippingPoint has been the leader in Gartner’s “Magic
Quadrant” in its evaluation of leading network security products.
Approximately 30 percent of the Fortune 1000 companies have already
deployed TippingPoint intrusion prevention systems.
“We are confident that we can run our entire global business of
300,000-plus employees, including our next-generation data centers,
entirely on the new HP networking solutions,” said Randy Mott,
executive vice president and chief information officer, HP. “Based
on our experience and extensive testing of 3Com’s products, we are
planning to undertake a global rollout within HP as soon as
possible after the completion of the acquisition.”
Under the terms of the merger agreement, 3Com stockholders will
receive $7.90 for each share of 3Com common stock that they hold at
the closing of the merger. The acquisition is subject to customary
closing conditions, including the receipt of domestic and foreign
regulatory approvals and the approval of 3Com’s stockholders. The
transaction is expected to close in the first half of calendar
2010.
HP anticipates that the transaction will be slightly dilutive to
fiscal 2010 non-GAAP earnings.
Audio webcast
This afternoon HP will conduct an audio webcast for financial
analysts and stockholders to discuss HP’s agreement to acquire
3Com.
Audio webcast for financial analysts and stockholders: 5 p.m. ET
/ 2 p.m. PT, hosted by Dave Donatelli, executive vice president and
general manager of Enterprise Servers and Networking at HP. Access
the live audio webcast at www.hp.com/investor/hpwebcast.
About 3Com Corporation
3Com Corporation is a $1.3 billion global enterprise networking
solutions provider that sets a new price-performance standard for
customers. 3Com has three global brands – H3C, 3Com and
TippingPoint – that offer high-performance networking and security
solutions to enterprises large and small. The H3C enterprise
networking portfolio – a market leader in China – includes products
that span from the data center to the edge of the network, while
TippingPoint network-based intrusion prevention systems and network
access control solutions deliver in-depth, no-compromise
application, infrastructure and performance protection.
About HP
HP creates new possibilities for technology to have a meaningful
impact on people, businesses, governments and society. The world’s
largest technology company, HP brings together a portfolio that
spans printing, personal computing, software, services and IT
infrastructure to solve customer problems. More information about
HP is available at http://www.hp.com.
Additional information and where to find it
3Com plans to file with the Securities and Exchange Commission
and furnish to its stockholders a proxy statement in connection
with the proposed merger. The proxy statement will contain
important information about the proposed merger and related
matters. Investors and stockholders are urged to read the proxy
statement carefully when it becomes available. Investors and
stockholders will be able to obtain free copies of the proxy
statement and other documents filed with the SEC by 3Com through
the website maintained by the SEC at www.sec.gov, and from 3Com by
contacting Investor Relations by mail at 3Com Corporation, 350
Campus Drive, Marlborough, MA 01752-3064 Attention: Investor
Relations, by telephone at +1 508 323 1198, or by going to 3Com’s
Investor Information page on its corporate website at www.3com.com
(click on “Investor Information”, then on “SEC Filings”).
Participants in the solicitation
3Com and HP and their respective directors and executive
officers may be deemed to be participants in the solicitation of
proxies from 3Com stockholders in connection with the acquisition.
Information about HP’s directors and executive officers is set
forth in HP’s proxy statement on Schedule 14A filed with the SEC on
January 20, 2009 and HP’s Annual Report on Form 10-K filed on
December 18, 2008. Information about 3Com’s directors and executive
officers is set forth in 3Com’s proxy statement on Schedule 14A
filed with the SEC on August 7, 2009 and 3Com’s Annual Report on
Form 10-K filed on July 27, 2009. Additional information regarding
the interests of participants in the solicitation of proxies in
connection with the merger will be included in the proxy statement
that 3Com intends to file with the SEC.
Forward-looking statements
This document contains forward-looking statements that involve
risks, uncertainties and assumptions. If such risks or
uncertainties materialize or such assumptions prove incorrect, the
results of HP and its consolidated subsidiaries, on the one hand,
and 3Com and its consolidated subsidiaries, on the other hand,
could differ materially from those expressed or implied by such
forward-looking statements and assumptions. All statements other
than statements of historical fact are statements that could be
deemed forward-looking statements, including the expected benefits
and costs of the transaction; management plans relating to the
transaction; the expected timing of the completion of the
transaction; the ability to complete the transaction considering
the various closing conditions, including those conditions related
to regulatory approvals; any statements of the plans, strategies
and objectives of management for future operations, including the
execution of integration plans; any statements of expectation or
belief; and any statements of assumptions underlying any of the
foregoing. Risks, uncertainties and assumptions include the
possibility that expected benefits may not materialize as expected;
that the transaction may not be timely completed, if at all; that,
prior to the completion of the transaction, 3Com’s business may not
perform as expected due to transaction-related uncertainty or other
factors; that the parties are unable to successfully implement
integration strategies; and other risks that are described in HP’s
SEC reports, including but not limited to the risks described in
HP’s Annual Report on Form 10-K for its fiscal year ended October
31, 2008 and Quarterly Report on Form 10-Q for the fiscal quarter
ended July 31, 2009, and 3Com’s SEC reports, including but not
limited to the risks described in 3Com’s Annual Report on Form 10-K
for its fiscal year ended May 29, 2009, and 3Com’s most recent
Quarterly Report on Form 10-Q. Neither HP nor 3Com assumes any
obligation and does not intend to update these forward-looking
statements.
© 2009 Hewlett-Packard Development Company, L.P. The information
contained herein is subject to change without notice. HP shall not
be liable for technical or editorial errors or omissions contained
herein.
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