Continuing its acquisition spree, Hewlett Packard Enterprise Company HPE recently announced entering into a definitive agreement to acquire the data storage provider, Nimble Storage Inc. NMBL. The deal is anticipated to close in April this year.

Founded in 2007, California-based Nimble makes flash-optimized hybrid storage platform which integrates two technologies – flash-based data storage and analytics. The company’s flash storage enables enterprises to understand how their storage is performing compared to their peers. With its employee strength of over 1,300, the company currently serves more than 10,000 enterprises.

Per the agreement, the company will pay $12.50 for every outstanding share of Nimble, representing a net cash price of about $1 billion. Apart from this, Hewlett Packard will make a payment of $200 million for Nimble’s unvested equity awards.

Strengthen HPE Hybrid IT Capabilities

The recently signed buyout deal is believed to be the company’s strategy of pushing itself further into the hybrid IT infrastructure space. It should be noted that since its split from HP Inc. (HPQ) in Nov 2015, Hewlett Packard has acquired several businesses in this space.

The company’s efforts toward expanding its footprint in the hybrid IT models were first noticed last year, when it acquired Silicon Graphics, which provides high-performance computing (HPC) services such as servers, storage, and data center solutions to clients in the cloud computing, oil & gas, e-commerce, social networking, and other industries.

Thereafter, in a move to further expand its foothold in the hybrid IT infrastructure space, the company signed agreements to acquire SimpliVity, Cloud Cruiser and Niara.

The common thing between all the aforementioned acquisitions is that all of them provide cloud based on-promise solutions which have been growing rapidly. On the other hand, Nimble's predictive flash storage enables cloud service providers in enhancing their offerings. Therefore, by integrating Nimble storage, Hewlett Packard will be able to enhance its cloud capabilities.

Defining Hybrid Cloud Infrastructure

The evolution of the cloud has been rapidly transforming the entire tech world. Over the last few years, we noticed mainstream adoption of cloud computing by enterprises. The exponential growth in the amount of data, complexity of data formats and need to scale up resources at regular intervals compelled several companies to turn to public cloud vendors.

This new IT-as-a-service model allows customers to pay only for the technology resources they use. The main benefit of this is that an organization does not have to make huge capital investments in IT. Apart from this, it frees up valuable IT resources for new value-adding projects as well as eliminates unused capacity.

However, workloads, which require higher security, compliance and service levels, cannot be kept on public cloud. Thus, there is a need for hybrid cloud infrastructure which offers customers on-premise cloud infrastructure.

Hybrid cloud is a combination of public and private clouds which function independently, but are connected together so that the enterprises can enjoy dual benefits. The adoption of hybrid clouds allows enterprises to have both on-premise computational infrastructure and cloud storage for core data.

The hybrid cloud solution allows enterprises to integrate their server, storage and virtualization platforms, which are handled primarily by software and not by hardware. The offering, thus, saves companies from purchasing different hardware components and integrating them manually, thereby providing cost-efficient means to handle server storage workload. As a result, the firms are opting for hybrid cloud instead of conventional clouds.

What Else will the Deal Bring in for HPE

We believe that the acquisition of Nimble’s business is a win-win situation for Hewlett Packard. Apart from enhancing the company’s hybrid IT infrastructure capabilities, the acquisition has several other benefits as well.

Firstly, Nimble's InfoSight Predictive Analytics platform makes it an ideal takeover target for Hewlett Packard. Per the company, “InfoSight automatically detects 90 percent of all issues within a customer's infrastructure, and resolves over 85 percent of them. This dramatically reduces the amount of time and effort a customer's IT team spends on support activities.”

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