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8/24/2010
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Dell To Trump HP Offer For 3PAR

Bidding war is still heating up a day after Hewlett-Packard made a $1.6 billion offer for the cloud storage firm.




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3PAR remains in the crosshairs of Hewlett-Packard, Dell, and at least one other undisclosed potential suitor as the players in the takeover of 3PAR study their next moves.

On Monday, HP topped Dell's bid for 3PAR by more than 33%. Dell is studying the situation and, according to a single source cited by Bloomberg news service, Dell is preparing to trump HP's offer. 3PAR has said a third possible suitor had expressed interest in taking over the cloud computing storage company, but that company's identity hasn't been revealed.

Dell started the bidding last week with a $1.15 billion offer for 3PAR; HP countered Monday with a $1.6 billion offer.

With its cash hoard of nearly $15 billion, HP can continue bidding, if it wishes. At HP, the focus is on Dave Donatelli, general manager of HP's enterprise servers, storage, and networking unit. Because of a contract obligation set by his former employer, EMC, Donatelli had been restricted from working in storage until recent weeks. One of the industry's preeminent executive storage experts, Donatelli will likely play a decisive role in any decision by HP to continue running up bidding for 3PAR.

In addition, Donatelli has suddenly been thrust into the limelight at HP, which is still reeling from the sudden departure of former chief executive Mark Hurd. Donatelli has said HP's evaluation of 3PAR began before Hurd left the firm.

Dell, which also has a large pile of cash, may need 3PAR more than HP does. Known primarily for its PCs and laptops, Dell has been trying to muscle its way into IT services ever since it acquired Perot Systems for $3.9 billion last year. A trophy like 3PAR would offer additional convincing evidence that it is becoming a major player in the IT enterprise world. Dell has said it wants to integrate 3PAR into its Dell/EMC product line.

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