AP, LTW

Dell (Nasdaq: DELL) says it’s buying data storage company (NYSE: PAR) for about $1.13 billion cash.

The company makes products designed to minimize capacity and energy costs.

TheStreet called the acquisition a "shrewd move."

"Long touted as attractive acquisition bait, 3Par is seen as well-positioned for the shift towards cloud computing, which will force users to drive more efficiency out of their servers and storage," "3Par is a pioneer in thin provisioning technology, which allocates storage only when it is needed in an attempt to boost utilization rates."

Dell Inc. is offering $18 per share for 3Par, an 87 percent premium over Friday’s closing price for the company, based in Fremont, Calif.

“We have aligned our storage offerings over the last several years to provide our customers choice and value,” said Brad Anderson, Dell’s senior vice president of its Enterprise Product Group. “3PAR brings the same values of performance, agility and ease-of-use to higher end, virtualized storage deployments as EqualLogic does for the entry-level and mid-range, rounding out our industry-leading solutions portfolio.”

Dell, based in Round Rock, Texas, said Monday it expects the deal to add to its adjusted profit in fiscal 2012. It says it also plans to invest in added engineering and sales resources in 3Par.

The deal has been approved by the boards of both companies and is expected to close this year.

3Par, of Fremont, Calif., make systems designed to make efficient use of available storage space through so-called "thin provisioning," which makes it easier to add capacity when needed. 3Par had an early lead in this technology, but competitors like NetApp Inc., EMC Corp., IBM Corp. and Hewlett-Packard Co. are starting to catch up. Dell already resells EMC’s products under the Dell/EMC brand.

“3Par has consistently provided customers with the ability to do more with less,” said David Scott, 3Par’s CEO. “With Dell we combine a powerful, virtualized storage platform with an outstanding distribution network to deliver this value to an even broader set of customers.”

Dell said 3Par’s technology is particularly suited to "cloud computing," where many customers may share the capacity of a data center.

Dell already resells EMC’s products under the Dell/EMC brand, and acquiring 3Par "could negatively impact Dell’s relationship with EMC," wrote Kaufman Bros. analyst Shaw Wu in a research note Monday. Wu estimates EMC represents about a quarter of Dell’s $2.2 billion storage revenue in the most recent fiscal year.

Wu also wrote that he thinks $1.13 billion is a steep price for 3Par.

But other analysts cast a more positive take on the deal. Dell said 3Par’s technology is particularly suited to "cloud computing," where many customers may share the capacity of a data center. Dell has been making itself over into a provider of cloud services, and Maynard Um, an analyst at UBS, wrote in a client note Monday that he believes the deal will strengthen the PC maker’s position in that area.

Um wrote that he believes Dell’s scale and global reach can help 3Par sales grow.

In its latest fiscal quarter, which ended Mar. 31, the company posted a loss of $3.2 million, or 5 cents per share on $194.3 million in revenue.

3Par was founded in 1999 and went public in Nov. 2007 at $14 per share.

For more on the deal,

Dell operates one of its largest PC assembly plants in Winston-Salem, N.C.

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