Hewlett Packard Enterprise and Juniper Networks have entered a definitive agreement under which HPE will acquire Juniper in an all-cash transaction for $40 per share, representing an equity value of $14 billion.
The transaction is expected to be funded based on financing commitments for $14 billion in term loans. It is currently expected to close in late calendar year 2024 or early calendar year 2025.
The combination of HPE and Juniper is seen advancing HPE’s portfolio mix shift toward higher-growth solutions and strengthens its high-margin networking business, accelerating HPE’s sustainable profitable growth strategy.
Also, the acquisition is expected to double HPE’s networking business as the explosion of AI and hybrid cloud-driven business is accelerating demand for secure, unified technology solutions that connect, protect, and analyse companies’ data from edge to cloud.
These trends, and AI specifically, is expected to continue to be the most disruptive workloads for companies, and HPE has been aligning its portfolio to capitalise on these substantial IT trends with networking as a critical connective component.
Together, HPE and Juniper intend to provide customers with a complete, secure portfolio that enables the networking architecture necessary to manage and simplify their expanding and increasingly complex connectivity needs.
Through its suite of cloud-delivered networking solutions, software, and services including the Mist AI and Cloud platform, Juniper helps organisations securely and efficiently access the mission-critical cloud infrastructure that serves as the foundation of digital and AI strategies.
The combination with HPE Aruba Networking and purposely designed HPE AI interconnect fabric will bring together enterprise reach, and cloud-native and AI-native management and control.
Upon completion of the transaction, Juniper CEO Rami Rahim will lead the combined HPE networking business, reporting to HPE president and CEO Antonio Neri.
Neri said the acquisition represents “an important inflection point” in the industry and will change the dynamics in the networking market, and provide customers and partners with a new alternative that meets their toughest demands.
“This transaction will strengthen HPE’s position at the nexus of accelerating macro-AI trends, expand our total addressable market, and drive further innovation for customers as we help bridge the AI-native and cloud-native worlds, while also generating significant value for shareholders,” he added.
Following the completion of the transaction, HPE intends to continue its innovation and go-to-market investments in its networking business, one of its growth engines.