Why Hewlett Packard Enterprise (HPE) Is Buying Silver Peak

By Amit Chowdhry ● July 15, 2020
  • Hewlett Packard Enterprise (NYSE:HPE) recently announced that it has entered into a definitive agreement to buy Silver Peak. These are the details about the deal.

Hewlett Packard Enterprise (NYSE:HPE) recently announced that it has entered into a definitive agreement to buy Silver Peak — which is an SD-WAN (Software-Defined Wide Area Network) leader — in a deal valued at $925 million. Silver Peak is going to be combined with HPE’s Aruba business unit and will extend Aruba’s technology leadership in the large and fast-growing SD-WAN space.

Silver Peak’s advanced SD-WAN offerings are complementary and will strengthen Aruba’s Edge Service Platform (ESP). And by combining Silver Peak’s SD-WAN with Aruba’s SD-Branch solutions customers can simplify branch office and WAN deployments to empower remote workforces, enable cloud-connected distributed enterprises, and transform business operations without compromising quality or reliability.

Silver Peak is known for being a leader in the SD-WAN market with over 1,500 production SD-WAN customers around the world. And the company helps enterprises and service providers quickly migrate to secure enterprise-grade SD-WAN connectivity while dramatically improving application performance and lowering connectivity costs. 

Customers can achieve dedicated WAN-like performance while running all cloud applications and services via broadband access — which is powered by Silver Peak’s SD-WAN edge platform. And Silver Peak also enables freedom of choice to utilize best-in-class technologies from a broad range of ecosystem partners, particularly those focused on security. 

As applications continue to move to the cloud, remote working and mobile employees are increasing, and billions of IoT devices are added to the network, the SD-WAN market has seen rapid growth. As this is expected to continue legacy WAN architectures are no longer viable and incur relatively high costs. So compelling enterprises are investing in SD-WAN technology to ensure secure, scalable, and efficient connections from the edge of their network to a diverse mix of on-premises and cloud-based endpoints. 

The combination of Aruba’s all-in-one SD-Branch strategy and remote worker solutions with Silver Peak’s SD-WAN and WAN optimization offerings will enable the company to better address a greater set of customer requirements and capitalize on this market opportunity.

A couple of years ago, HPE announced its strategic plan to invest $4 billion in Intelligent Edge over four years. And the company has been identifying opportunities to better help customers convert their data – from every edge to any cloud – into actionable insights that drive seamless interactions while delivering simplified user and IT experiences. 

The impacts of the global pandemic have intensified customers’ requirements for powerful and reliable solutions at the edge that put a premium on security, connectivity, and performance. And this investment is consistent with HPE’s core strategy focused on accelerating investments in areas of attractive, profitable growth including the Intelligent Edge.

The companies are expecting the combination to create opportunities for significant economic upside through enhanced growth and profitability by 1.) Providing a superior value proposition to joint customers through integrated offerings that address a greater set of customer requirements 2.) Targeting an expanded TAM across SD-WAN and SD-Branch implementations and 3. Accelerating WAN transformations across HPE and Aruba’s broad global customer base.

The transaction is expected to close in the fourth quarter of HPE’s fiscal year 2020, subject to regulatory approvals and other customary closing conditions.

Key Quotes:

“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.”

— Antonio Neri, president and CEO of HPE

“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.”

— Keerti Melkote, president of Intelligent Edge for Hewlett Packard Enterprise and founder of Aruba Networks

“Bringing together Silver Peak’s advanced SD-WAN solutions with Aruba’s industry leading networking portfolio provides an unprecedented opportunity to deliver 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.”

— David Hughes, founder and CEO of Silver Peak

Featured Photo Credit: Silver Peak