Hewlett Packard Enterprise to buy supercomputer maker Cray in US$1.30 billion deal

Hewlett Packard Enterprise to buy supercomputer maker Cray in US$1.30 billion deal

Supercomputer manufacturer Cray Inc said on Friday it would be bought by Hewlett Packard Enterprise Co in a deal valued at about US$1.30 billion.

A trader passes by the post where Hewlett Packard Enterprise Co., is traded on the floor of the New
A trader passes by the post where Hewlett Packard Enterprise Co., is traded on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., May 25, 2016. REUTERS/Brendan McDermid

REUTERS: Supercomputer manufacturer Cray Inc said on Friday it would be bought by Hewlett Packard Enterprise Co in a deal valued at about US$1.30 billion, net of cash.

The US$35 per share value represents a premium of 17.4per cent to Cray's last close.

HPE said it expects the deal to increase its footprint in federal business and academia, and sell supercomputing products to its commercial clients.

The deal, expected to close by the first quarter of HPE's fiscal year 2020, will add to its adjusted operating profit in the first full year after closing.

As part of the deal, HPE expects to incur one-time integration costs that will be absorbed within its fiscal year 2020 free cash flow outlook of US$1.9 billion to US$2.1 billion that remains unchanged.

Seattle-headquartered Cray has U.S.-based manufacturing operations and about 1,300 employees worldwide. It earned US$456 million in revenue in its last fiscal year.

Cray's supercomputing systems can handle massive data sets, converged modeling, simulation, artificial intelligence, and analytics workloads.

(Reporting by Arjun Panchadar in Bengaluru; Editing by Shounak Dasgupta)

Source: Reuters

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