Dell Prepping Higher Bid for 3Par

Published on August 24, 2010
by John Paczkowski

rockem-sockem-150x150It’s taken three years and a pair of buyout offers, but 3Par’s stock is finally trading above its IPO price again. Shares in the data-storage provider spiked 40 percent to $25.31 Monday, when Hewlett-Packard offered to acquire it for $1.6 billion–a week after 3Par agreed to a $1.15 billion buyout by Dell.

3Par’s (PAR) share price on August 15, the day before Dell’s offer became public? $9.65.

Given the abrupt increase in the company’s share price Monday, it seems clear that investors feel this particular bidding war has only just begun, and Dell (DELL) will parry Hewlett-Packard’s (HPQ) offer with an even richer one. And, according to Bloomberg, they’re right. Sources familiar with the matter tell the publication Dell is indeed drawing up a sweetened offer for 3Par, though analysts question whether the company can even come up with the shock-and-awe-size number that it will take to knock HP out of the running. “HP is going to win,” Wedbush Securities analyst Kaushik Roy told Bloomberg. “Dell just doesn’t have that ammunition. HP has the balance sheet to buy anything…. At this point, the amount of premium these guys are paying is insane.”

Dell’s new offer is expected in the coming days.

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