HP to buy 3Com for $2.7 billion

Palo Alto, Calif. — HP will purchase 3Com for $2.7 billion, which will significantly expand HP’s Ethernet switching offering, add routing solutions and network security capabilities and strengthen the company’s position in China.

HP and 3Com Corp., based in Marlborough, Mass., have entered into a definitive agreement under which HP will purchase 3Com, 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. The transaction is expected to close in the first half of calendar 2010.

HP said the transaction underscores the company’s next-generation data center strategy built on the convergence of servers, storage, networking, management, facilities and services.

“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,” said Dave Donatelli, executive vice president and general manager, Enterprise Servers and Networking, HP, in a statement.

HP also said it plans to run its entire global business including next-generation data centers entirely on new HP networking solutions. A global rollout will start after the completion of the acquisition.