EU regulator reportedly set to give the nod to HPE-Juniper deal
Aruba, Aruba! Some network pros worry it will lead to less choice
The European Commission is set to deliver unconditional approval for HPE's proposed $14 billion purchase of Juniper Networks, according to reports.
HPE announced back in January that it had entered into a definitive agreement with Juniper to snap up the California-based network kit maker in order to boost its connectivity capabilities for demanding AI and hybrid cloud applications.
The EU's competition regulator gave itself a deadline of August 1 in order to decide whether to block the deal or give it the go-ahead, but Reuters now claims that it is likely to pass with flying colors, citing anonymous sources said to be familiar with the matter.
But neither HPE, nor the European Commission, was prepared to comment on the matter. Juniper was not immediately available to respond to our queries.
If the deal does pass inspection, then the move is expected to effectively double the size of HPE's networking business, which was built on its earlier acquisition of Aruba about nine years ago, back when it was still HP.
But as The Register previously reported, the major emphasis of this takeover appears to center on HPE's determination to capitalize on the growing market for AI products.
CEO Antonio Neri said at the time that he expected the merger to "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."
The Texas-based IT titan is already one of those benefiting from the GenAI wave by supplying servers and solutions optimized for AI. In its Q2 earnings for FY2024, HPE saw the cash brought in by its Server division grow 18 percent to $3.9 billion, with revenue more than doubling from the previous quarter thanks to AI.
However, not everyone is happy about the potential merger of HPE and Juniper, with some network professionals expressing concern that it will ultimately lead to less choice as HPE prunes away any overlap between Juniper and Aruba once the deal closes.
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Then there is also the UK's competition watchdog, the Competition and Markets Authority, which decided to launch its own investigation into HPE's planned takeover. The agency has until August 14 to decide whether to allow the deal to go ahead or refer it for a more prolonged phase two investigation.
We asked the CMA for comment, but it declined to add anything beyond what is published on its case page.
If all goes well the transaction is still expected to close in later this year or in early 2025. ®