3Par on Thursday said Hewlett-Packard has raised its offer to $33 a share for the storage company, or $2.4 billion, after Dell countered with a $32 a share offer.
Needless to say, 3Par deemed HP's bid as superior. HP had bid $30 for 3Par and Dell countered with $32 a share. Dell also wanted a revised a termination fee to $92 million.
In other words, the 3Par bidding got a bit messy following HP's offer for $30. Dell had three days to match but was largely quiet.
Although 3PAR previously notified Dell of its intention to terminate its merger agreement with Dell, the merger agreement was not terminated and remains in full force and effect. Following 3PAR's notice of intent to terminate the merger agreement, and prior to receiving HP's revised acquisition proposal, 3PAR received a revised acquisition proposal from Dell in which Dell increased its offer price from $27 per share to $32 per share. Dell's revised acquisition proposal also included an increased termination fee of $92 million payable by 3PAR to Dell as a condition to accepting a "superior proposal," and a multi-year reseller agreement with Dell, which would by its terms be assumed by an acquirer of, or successor in interest to, 3PAR in the event of a change in control of 3PAR (including the acquisition of 3PAR by HP or another third party), and which contained fixed pricing and other terms that the 3PAR board of directors determined to be unacceptable.
After that volley with Dell, 3Par was able to squeeze more money out of HP (statement). So where do we stand now? 3Par's merger agreement with Dell is still in effect. Simply put, Dell may match HP's offer again and the bidding continues. Shares of 3Par are trading at $33.60 in early trading. That sum indicates that investors think the 3Par valuation could go higher, but not by much.
Well played 3Par.
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