Do I hear 2.5 billion?

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The bidding war between Dell and HP over virtualisation storage firm 3PAR has been underway for some time.

Dell opened proceedings with a bid of $18 per share putting a value on the company of about $1.15 billion. HP then came in with its bid of $1.8 billion for the company, a hefty premium above market valuation.

Dell later matched the bid, but HP raised its bid further to $2 billion, and now Dell has matched this too.

The fight strangely echoes that of EMC and NetAPP, last year over Data Domain, but it does focus the mind why such a war has broken out over a company that specialises in storage virtualisation in the VMware environment.

Dell, in particular, through its alliance with EMC, who after all own VMware, would appear to have access to such technologies without getting into a very public bidding war.

That said, 3PAR has worked very successfully within the VMware ecosystem, and has been well featured in VMware’s various road shows as an example of how it works with third parties to develop the offerings within its platform. However, few commentators would have said that 3PAR’s offerings were of the order of magnitude that would precipitate such a tug of war. The overall attitude seems to be, it’s good, but not that good!

So, what is going on here? Well, some have argued that it is the talent with 3PAR, combined with the already commercialised IP that is really the prize here and would allow the acquirer to get a jumpstart in cloud and virtualised storage.

This makes sense, to a degree, as many companies offering cloud services, infrastructure as a service (IaaS) to software as a service (SaaS), are already metering such services by two criteria only, power draw and storage. If the biog guns go the same way, then storage, and its management and billing will become a key part of how cloud services are adopted and administered.

However, with HP in particular, there seems to be a bit of bet hedging. It was announced this morning that it had acquired Stratavia, which is described as “database and application automation firm”. So it appears as if HP is filling its quiver with various bolts to ensure that it can work with data in virtual environments.

It just remains to see what happens next and try to grab some 3PAR shares if you can. The share price has already climbed above $30 on the back of the bidding war.

Read More: Paul Hearns