Hewlett Packard Enterprise will be paying more than $1 billion to acquire Nimble Storage, a flash memory maker company.
Founded in 2007, Nimble, based in San Jose, has around 1,300 employees. The company’s revenue rose 30% to $117.0 million, up from $90.1 million in the November 2015-January 2016 period. According to Angelo Zino, equity analyst at CFRA Research, sales for Nimble rose 30%. Zino has a Buy recommendation on HPE and believes the acquisition of Nimble, “expands HPE’s presence in the high growth all-flash array market and is complementary to its existing offerings.”
In an effort to expand the type of flash storage that it offers business customers, HPE will pay $12.50 per share in an all cash transaction for Nimble Storage, which comes out to around $1.09 billion. Based on Nimble’s closing share price on Monday at $8.60, this is a 45% premium over that price.
The deal will allow Hewlett Packard Enterprise to expand on the kind of flash storage it offers its business customers. HPE President and CEO Meg Whitman stated, “We remain focused on high-growth and higher-margin segments of the market.”
This isn’t the first big deal for HPE this year. The company spent $650 million in January to acquire SimpliVity, a cloud computing infrastructure company. HPE also bought Cloud Cruiser for an undisclosed sum. Cloud Cruiser is an IT analytics company.
Nimble will become a wholly-owned subsidiary of HPE after a tender offer is completed and the transaction is closed. The deal is expected to be completed in April.
HPE Vice President and General Manager Antonio Neri stated, “We’ll have a comprehensive, best-in-class portfolio across the full range of the market.”
Disclaimer: We have no position in Hewlett Packard Enterprise Co (NYSE: HPE) nor Nimble Storage Inc (NYSE: NMBL) and have not been compensated for this article.