Dell on Thursday said it would not increase its most recent proposal to acquire virtualized storage vendor 3PAR, paving the path for rival Hewlett-Packard to acquire the company.
In a escalating bidding war, HP on Thursday raised its offer for 3PAR to US$33 per share, or roughly $2.4 billion, from its previous bid of $30 per share. The move topped Dell's latest offer of $32 per share, according to 3PAR.
HP's bid constituted a "superior offer," and Dell's final offer to acquire 3PAR was not accepted by 3PAR's board of directors, Dell said in a statement.
"We took a measured approach throughout the process and have decided to end these discussions," said Dave Johnson, senior vice president of corporate strategy at Dell. Dell is entitled to receive a $72 million break-up fee from 3PAR upon the termination of its merger agreement.
Dell initially agreed to buy 3PAR on August 16 for $1.15 billion, but HP on Aug. 27 submitted a bid to buy 3PAR for $1.6 billion. The bidding process for the company escalated, and on Thursday, the board of directors at 3PAR considered HP's revised $33 per share bid as being a "superior proposal" to Dell's $32 per share proposal.
3PAR did not return requests for comment. An HP spokesperson declined comment.
3PAR makes scalable storage platforms with thin provisioning, under which allocation of storage depends on application needs. 3PAR's technology differs "fat provisioning," under which excess storage is allocated to an application to meet future needs.