HP Set to Acquire Aruba Networks for $2.7 Billion

HP aims to grow its WiFi capabilities through Aruba Networks acquisition.

By Sean Michael Kerner | Posted Mar 2, 2015
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Hewlett-Packard (HP) has tried several times over the last decade to grow its Wi-Fi networking business, both through organic growth and acquisitions. Today HP formally announced yet another WiFi business acquisition, with a $2.7 billion bid for Aruba Networks.

The deal is an equity transaction that will see HP pay $24.67 for each Aruba share. The deal is set to close in the second half of HP's fiscal 2015, pending shareholder and regulatory approvals.

From a leadership perspective, once the deal closes, the plan is to have Aruba's existing management remain in place. Aruba CEO Dominic Orr will continue to lead the Aruba product brand within HP and report to Antonio Neri, leader of HP Enterprise Group.

"This transaction brings together Aruba's best-of-breed mobility hardware and software solutions with HP's leading switching portfolio," Orr said in a statement. "In addition, Aruba's channel partners will have the opportunity to expand their businesses with HP offerings."

HP has tried to make headway in the WiFi market in the past via the acquisition of Colubris Networks in 2008. The Colubris Wi-Fi technology was integrated into the HP ProCurve lineup after the acquisition.

In 2010, HP tried again to grow its networking presence via the $2.7 billion acquisition of 3Com. After the 3Com acquisition closed, HP rebranded the HP ProCurve portfolio as HP Networking.

HP has been building out its own branded WiFi gear, though it has faced increasing competition from rivals, including Cisco. Cisco made a WiFi move of its own in 2012 with the $1.2 billion acquisition of Meraki. Meraki's technology has since been expanded by Cisco to provide broad cloud-based wired and wireless networking infrastructure and management capabilities.

Aruba has been active in recent years, partnering with multiple vendors, including an OEM arrangement with Dell in 2010 and a go-to-market partnership with Juniper in 2014.

Aruba has also been actively partnering with vendors on its ClearPass network access control platform. Aruba's ClearPass partnerships include one with Brocade as well as Alcatel-Lucent.

"Enterprises are facing a mobile-first world and are looking for solutions that help them transition legacy investments to the new style of IT," Meg Whitman, Chairman, President and Chief Executive Officer of HP, said in a statement. "By combining Aruba's world-class wireless mobility solutions with HP's leading switching portfolio, HP will offer the simplest, most secure networking solutions to help enterprises easily deploy next-generation mobile networks."

Sean Michael Kerner is a senior editor at Enterprise Networking Planet and InternetNews.com. Follow him on Twitter @TechJournalist.

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