Information technology company Hewlett Packard Enterprise (NYSE:HPE) has confirmed the acquisition of networking products company Juniper Networks (NYSE:JNPR) for $14 billion. This news came after a Wall Street Journal report that Hewlett Packard was closing in on this acquisition.
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HPE will acquire Juniper in an all-cash deal for $40 per share, with the deal expected to close later this year. The transaction is expected to be accretive to adjusted earnings per share and free cash flow in the first year post-close of the merger.
HPE’s merger with Juniper will likely enhance its portfolio, shifting its product mix towards a high-margin networking business. The transaction is anticipated to double HPE’s networking business.
Following the close of the acquisition, Juniper’s CEO, Rami Rahim, will lead HPE’s networking business and report to HPE President and CEO Antonio Neri.
Is HPE Stock a Good Buy?
Analysts remain cautiously optimistic about HPE stock with a Moderate Buy consensus rating based on four Buys and nine Holds. Over the past year, HPE stock has declined by more than 2%, and the average HPE price target of $18.08 implies an upside potential of 12% at current levels.
