HP buys 3Com for $2.9 billion

Wants to help customers "break free" of Cisco.

HP has purchased networking vendor 3Com for US$2.7 billion ($2.9 billion) in a move that will bolster the end-to-end data centre product market it is battling with Cisco to control.

The deal is subject to domestic and foreign regulatory approvals and the approval of 3Com's stockholders.

If it is given the green-light, the transaction is expected to close in the first half of next year.

HP said in a statement that the 3com acquisition would "transform the networking industry and underscore HP's next-generation data centre strategy built on the convergence of servers, storage, networking, management, facilities and services."

In a not-so-subtle dig at Cisco, HP's executive vice president and general manager, enterprise servers and networking, Dave Donatelli, claimed companies were "looking for ways to break free from the business limitations imposed by a networking paradigm that has been dominated by a single vendor.

"By acquiring 3Com, we are accelerating the execution of our Converged Infrastructure strategy and bringing disruptive change to the networking industry," Donatelli said.

"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 centre."

The acquisition will dramatically expand HP's Ethernet switching offerings, add routing solutions and significantly strengthen the company's position in China, Donatelli said.

HP will also benefit from 3Com's Chinese research and development operations.

In an analysis, ZDNet US' Larry Dignan said that by acquiring 3Com, "HP is hitting Cisco in its core business since the networking giant is targeting servers."

Cisco last month unveiled its push into the server space via the unified computing solution platform.

An Australian HP spokesman could not provide any further details on the acquisition, other than to say that "the two companies must continue to operate independently until the acquisition closes."