Hewlett-Packard (HP) is set to purchase wireless networking company Aruba Networks to the tune of $2.7 billion, marking the company’s first major possession since the forgettable acquisition of a software company which is based in Great Britain in 2011.
Situated in Sunnyvale, California, Aruba whips up Wi-Fi networking systems for corporate campuses, universities, shopping malls and hotels. The company has flourished over the years thanks to the growing number of people who are employing mobile devices at work, school and the likes. Aruba may play a role in HP’s aim on pouncing on the latest trend which has suffered decline in sales of its conventional HP products like the desktop computers.
The acquisition will also aid HP to contend with established rivals like Cisco Systems and penetrate the lucrative Asian markets specifically China. Cisco currently supplies 50% of the commercial wireless networking materials in the world, while HP and Aruba accounted for 20% of worldwide sales according UBS analyst Amitabh Passi.
HP is seeking to expand its market presence for its business clients during the period where it is gearing up to divide into two companies (one is concentrated on selling computer systems and software to its customers, and while the remaining half is focused on vending personal computers and printers. The split eventually give rise to recent drop in sales.
According to the statement whipped up by Toni Sacconaghi on Monday, “The acquirement of Aruba provides HP “a faster growing, higher margin business that fills a portfolio need without `betting the ranch’.”