(Thumbnail Image: eWeek Europe)

BY ADNAN KHAN


“So on Sunday Hewlett-Packard announced that it is the Gene Simmons of the tech ... world by announcing a surprise $1.6 billion bid for the storage company 3Par and telling Dell and its previously set 3par at $1.15 billion deal that it is little bit more than James Taylor in the process.”
 (MarketWatch)

HP’s decision to outbid Dell over a data storage company, which no one had even heard of until this Sunday, has shocked the Tech world and sparked a debate over which company should acquire 3Par.

We are analyzing coverage from SmarTrend, the Financial Times, PC World, Tech World and Bloomberg.

SmarTrend is reporting Dell is gearing up for the possible bid war with a bid of its own and is willing to pay as much as double what the 3Par stock is worth.

“Whichever company wins the bidding battle will get a considerable boost in a challenge to CISCO systems and IBM market share for data center products and services.”

The Financial Times reports historically there has never been a high demand for these data storage companies. Nowadays though, with stored data doubling every 18 months and companies investing more time in analyzing this data, 3Par’s services have become invaluable.

“Telecoms that are tracking every phone call, retailers that tracking every purchase are trying to find out more about what that information tells them. ... 3Par is seen as a leader in this space and therefore one that is entitled to the 87 percent premium that Dell offered now looks to collect more than double what the shareholders thought the company was worth.”


The question is who’s the best fit for 3Par? According to PCWorld article, HP might be a better suitor for the company simply because of its size.

“It is number one in a diverse array of categories including worldwide server revenue, worldwide server shipments ... and revenue generated from Microsoft Windows. In almost every one of those categories, the number two rival is Dell.”


Now bigger is not always better. Another article on Techworld argues for Dell as the better option, because the company could create a strong foundation to move into the cloud computing market.

“Dell's bid was always and still remains about more than just storage. Dell wants to be more of an enterprise player in the data center, and this is part of a jigsaw piece in that puzzle."

But on Bloomberg, a former Bear-Sterns board member argues even though Dell needs this deal more than HP, the deal itself doesn’t really matter.

“The reason I say that it doesn’t really matter to especially HP is because even at a 33 percent premium there is no material dilution according to HP on their conference call this morning, that can suffered on the 2011 earnings. That’s really because this company is so much smaller than Hewlett-Packard or even Dell.”

With both companies in need of data storage capacities, which one do you think 3Par board of directors should lean toward?

Get more multi-source news analysis from Newsy.com.