HPE hopes to close the deal by the end of this year or early 2025. The announcement came a day after the WSJ reported that the two companies were in final round of discussions.
Juniper’s stock had its biggest gain in 20 years on January 9 after the WSJ article. Specifically, the price jumped 22% to nearly $37.05.
The acquisition will double HPE’s current networking business after years of competition. If completed, Juniper CEO Rami Rahim will lead the merged unit and report to HPE CEO Antonio Neri.
Hewlett-Packard (HP) dug deep into the networking business after acquiring Aruba Networks in 2015. A few months later, HP split into two companies, leading to the birth of HPE, which sells servers and other equipment for data centers, and HP Inc, which manufactures personal computers, printers.
HPE says adding Juniper to its portfolio will strengthen margins and accelerate growth. Founded in 1996, Juniper spent years trying to follow Cisco in the networking equipment market.
In 2022, the company’s revenue grew 12% over the previous year. In the most recent quarter, Juniper earned $76 million on revenue of $1.4 billion, down 1% from the same period last year.
HPE’s networking equipment business is the company’s largest pre-tax source of income with profits of $401 million on revenue of $1.4 billion, up 41%.
According to HPE, coming together under one roof helps both save $450 million in annual costs within three years of completing the deal.
