A 3Par employee worked on the InServ T-class data storage servers at the company’s headquarters in Fremont, Calif.
(Tony Avelar/Bloomberg News)
EMC has stake in battle for 3Par
Target of HP, Dell bids is rival of Hopkinton firm
A 3Par employee worked on the InServ T-class data storage servers at the company’s headquarters in Fremont, Calif.
(Tony Avelar/Bloomberg News)
As Hewlett-Packard Co. and Dell Inc. continued their seesaw battle for California data storage firm 3Par Inc. yesterday, executives at a Massachusetts company were probably watching intently from the sidelines.
EMC Corp. of Hopkinton, which competes with 3Par in the data storage business and is a longtime partner with Dell, will be affected no matter which company ultimately wins the bidding war.
The competition between personal computer giants HP and Dell indicates that both are looking at 3Par as a way to build their capabilities in a computer sector that is at the core of EMC’s business: management and storage of the terabytes of data businesses generate daily.
EMC would not comment yesterday on the negotiations, but the HP-Dell showdown demonstrates the value of a company like 3Par, which is a leader in “cloud’’ storage. The technology allows companies to manage digital information on remote servers located in distant data centers and avoid having to buy large banks of storage computers.
Yesterday, in the latest round of bidding, HP boosted its offer for 3Par to $1.88 billion, topping Dell’s price by 11 percent. The $30-per-share offer from HP came just hours after Dell matched HP’s Thursday bid of $27 a share.
Prior to HP’s countermove, Dell and 3Par said early yesterday that 3Par’s board had accepted the bid from Dell, which only has to match the terms of other offers under its initial agreement with 3Par.
But 3Par’s stock continued to surge above HP’s price, suggesting investors expect the price to keep going up.
“There’s a land grab going on among computer companies, and it’s raising the level of competitiveness for EMC,’’ said Zeus Kerravala, an analyst with Yankee Group in Boston.
“Whoever buys 3Par will have another piece of the complete data center package, and the more complete their package, the less they will need EMC,’’ Kerravala added. “Even if they do need EMC, it will be as just a piece in their larger ecosystem.’’
The competition between 3Par and EMC was on display last year in a lawsuit filed by EMC after one of its executives, David Donatelli, left to work at HP. EMC insisted Donatelli, who was president of EMC’s data storage products operation, honor an agreement not to work for a rival for 12 months. Donatelli sued to get out of the contract in California, but EMC countersued in Massachusetts, where a judge subsequently ruled Donatelli could work for HP as long as he steered clear of the company’s storage business for a year.
EMC has not stood by idly as the cloud storage model has flourished. Last year, it made a deal with Cisco to sell integrated computer, storage, and networking services. EMC also spent $2.1 billion last year to buy Data Domain, which makes products to eliminate unnecessary duplication of stored data — a process vital to making storage clouds more efficient.
EMC has also partnered with Dell to allow the computer company to resell high-end network storage products made by EMC. But that arrangement would be severely tested if Dell winds up buying 3Par, giving Dell its own high-end storage provider.
For that reason Kerravala said EMC will most likely fare better if HP ends up winning the 3Par bidding war.
“At least that will preserve EMC’s partnership with Dell,’’ he said.
D.C. Denison can be reached at denison@globe.com. ![]()




