Dell to Buy 3PAR for $1.15 Billion

Dell has inked a deal to acquire 3PAR, a maker of virtualized, multi-tenant storage arrays, for approximately $1.15 billion in cash.

Under the terms of the agreement, Dell (NASDAQ: DELL) will commence a tender offer to acquire all of the outstanding common stock of 3PAR (NYSE: PAR) for $18 per share in cash. The transaction is expected to close before the end of the year.

Dell plans to integrate 3PAR’s storage systems into its portfolio where they will join Dell’s PowerVault, EqualLogic and Dell/EMC families.

This is Dell’s second storage deal in as many months. The acquisition of 3PAR, which is known for its capacity-saving provisioning technologies, follows last month’s acquisition of data deduplication and data compression specialist Ocarina Networks.

Ocarina and the embeddable version of its software brought data deduplication to Dell’s primary storage offerings as well as to backup and archiving. The acquisition of 3PAR will add dynamic tiering and thin provisioning, for multi-tenant cloud-computing environments.

3PAR’s InServ Storage Servers are comprised of a high-bandwidth, low-latency backplane that unifies cost-effective, modular, and upgradeable components into a highly available and autonomically load-balanced cluster. The InServ’s main claim to fame is its “Thin Built In” technology, which is based on 3PAR’s homegrown ASIC technology and provides hardware-based thin provisioning for just-in-time capacity provisioning.

The InServ’s full-mesh, passive backplane provides a dedicated 1.6GBps data path between the 3PAR Gen3 ASICs in each InServ Controller Node. The interconnect allows each application workload to be distributed and shared across all system resources in a massively parallel fashion.

In a press release this morning, Brad Anderson, a senior vice president with Dell’s Enterprise Product Group, said “3PAR brings the same values of performance, agility and ease-of-use to higher end, virtualized storage deployments as EqualLogic does for the entry-level and mid-range, rounding out our industry-leading solutions portfolio."

After closing, Dell plans to maintain and invest in additional engineering and sales capability. There are no plans to move 3PAR’s current operations.

Based on current estimates, the transaction is expected to be accretive to Dell non-GAAP earnings in its Fiscal Year 2012.

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