The Competition and Markets Authority (CMA) in the UK is looking into Hewlett Packard Enterprise’s (HPE) $14 billion acquisition of rival Juniper Networks to determine if it will negatively impact competition in the country. The CMA has until August 14 to decide if further investigation is necessary.
HPE announced the acquisition of Juniper Networks in January with the goal of enhancing its artificial intelligence capabilities. The deal is expected to double HPE’s networking business, increasing its share of total revenue from 18 percent to 31 percent starting in fiscal 2023 and contributing more than half of its operating revenue.
The all-cash deal will expand HPE’s reach in the networking sector, allowing for more comprehensive solutions for Juniper’s enterprise, communications service, and cloud customers. It will also provide HPE with access to additional segments such as data center networks, firewalls, and routers, while strengthening Juniper’s position in data centers and cloud services.
The combined entity aims to achieve operational efficiencies and cost synergies of $450 million within three years of closing the deal. This, paired with strong free cash flow growth and capital allocation policies, is expected to reduce leverage to approximately 2x within two years post-closure.
Overall, the acquisition of Juniper Networks by HPE is seen as a strategic move to enhance both companies’ market positions and offerings in the rapidly evolving technology landscape. The CMA will decide by August 14 whether the transaction raises any competition concerns in the UK.
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https://infotechlead.com/networking/hpes-14-bn-deal-to-buy-juniper-networks-faces-probe-in-uk-85462
