Hewlett Packard Enterprise is acquiring SD-WAN technology provider Silver Peak for $925 million. The HPE-Silver Peak business combination essentially counters Aryaka, Cisco Systems, Fortinet, Nuage Networks from Nokia, Versa Networks, and VMware SD-WAN by VeloCloud, among others.
This is M&A deal 280 that ChannelE2E has covered so far in 2020. See the complete M&A deal list here.
Rumors about Silver Peak being up for sale swirled ahead of the deal. The leaks likely attempted to push the seller's valuation to $1 billion, ChannelE2E believes, though the final price was $75 million short of that mark.
HPE Acquires Silver Peak: SD-WAN Revenue, MSP Partner Opportunity
The deal comes as HPE strives to diversity beyond traditional data center hardware -- especially in the age of cloud services and monthly recurring revenues. SD-WAN services should help that effort.
Indeed, the worldwide SD-WAN (software defined-wide area networking) industry market grew 64 percent and surpassed $1 billion for the full year 2019, Dell’Oro Group reports.
HPE will tuck Silver Peak into the Aruba business unit. By combining Silver Peak’s SD-WAN with Aruba’s SD-Branch solutions, partners and customers can simplify branch office and WAN deployments for remote workforces and cloud-connected distributed enterprises, the companies said.
MSP Opportunity: Silver Peak’s partner-centric solutions include the Unity EdgeConnect — which enables MSPs to deliver SD-WAN services with SLAs (service level agreements) in and out-of-region, the company says. Unity EdgeConnect surpassed 1,500 customer deployments in early 2019.
HPE Acquires Silver Peak for SD-WANs: Executive Perspectives
In a prepared statement, HPE CEO Antonio Neri asserted:
“HPE was an early mover in identifying the opportunity at the edge and that trend is accelerating in a post-COVID world. With this acquisition we are accelerating our edge-to-cloud strategy to provide a true distributed cloud model and cloud experience for all apps and data wherever they live. Silver Peak’s innovative team and technology bring critical capabilities that will help our customers modernize and transform their networks to securely connect any edge to any cloud.”
Added Keerti Melkote, president of Intelligent Edge for HPE and founder of Aruba Networks:
“Today’s announcement comes at a unique moment for our customers, who are grappling with business recovery in the wake of the pandemic,. The need for edge-to-cloud architectures has never been more relevant as enterprises look to extend connectivity to branch locations and enable secure work-from-home experiences. Silver Peak’s technology transforms legacy WAN architectures to self-driving WANs, which is a perfect fit with Aruba’s cloud-native, AI-driven Edge Services Platform. Together, we will be able to meet these needs with critical connectivity, security, and AI capabilities to drive the next generation of Edge-to-Cloud transformation.”
Concluded David Hughes, founder and CEO of Silver Peak:
“Bringing together Silver Peak’s advanced SD-WAN solutions with Aruba’s industry leading networking portfolio provides an unprecedented opportunity to deliver a comprehensive business-driven solutions to our customers. The Silver Peak and Aruba teams share a common vision and goal to provide simplicity, scalability, and application-awareness at the edge. With Aruba’s extensive go-to-market, we will further accelerate our ability to drive faster adoption of these transformational technologies. We are excited for the opportunities we will have as a combined team to accelerate innovation in this fast-growing segment of the networking market.”
HPE Acquires Silver Peak for SD-WANs: Rival Perspectives
And in a statement about the deal from rival Aryaka, Chief Marketing Officer Shashi Kiran said:
“As the market moves rapidly towards convergence, we expect a number of box sellers to be acquired as the general trend moves towards consolidation and see this trend happening with other point solution vendors as well. The dynamics of this market is moving towards cloud-first, managed offerings that accelerate digital transformation and Aryaka Networks is very well positioned to address those requirements with its end-to-end solution. This may be a good outcome for Silver Peak, and we wish them and the HPE teams the very best in their combined avatar.”
The HPE-Silver Peak deal is expected to close in the fourth quarter of HPE’s fiscal year 2020, pending regulatory approvals.
