Dell Trumped: H-P Bids For 3PAR (DELL, HPQ, PAR)

Dell Inc. (NASDAQ: DELL) was getting criticized for its super-premium buyout of 3PAR, Inc. (NYSE: PAR).  That criticism may have been overstated.  Hewlett-Packard Company (NYSE: HPQ) has just trumped Dell with a new $24.00 offer to acquire 3PAR.

The bid for the utility storage systems maker is a cash offer that has no finance contingencies and is a 33% premium to Dell’s $18.00 offer.  Including the debt, this represents an enterprise value of roughly $1.6 billion.

Mark Hurd may be gone and H-P may have hit a 52-week low on Friday, but the company is trying to signal two things at once.  The lead it captured from Dell is one it does not want to let slip while it is healing.  The company also wants to signal that it will be an acquirer in a competitive landscape for converged infrastructure.

This now sets the stage for a bidding war.  3PAR shares are trading up at $24.75 in anticipation that another bidder may emerge or that Dell will be back to the table offering more.  Dell is indicated up 0.5% while H-P shares are indicated down marginally.

JON C. OGG