HP Buys Opsware for $1.6 Billion

HP will acquire data center automation specialist Opsware Inc. (OPSW) for $14.25 per share, or about $1.6 billion. HP said the purchase of Opsware, which started life as LoudCloud, will add to its portfolio of Business Technology Optimization (BTO) software offerings. It’s also a clear sign of the growing importance of the data center in the strategies of the largest players in the technology industry.

Opsware shares closed Friday at $10.28, but are up 37% to $14.06 in pre-market trading this morning.

UP said Opsware will extend its capabilities to automate the entire data center. “The acquisition of Opsware is intended to enable HP Software to help our customers resolve one of their critical pain points: controlling the increasing complexity and cost of managing the data center,” said Thomas E. Hogan, senior vice president, Software, HP.

“We are about to see one of the biggest application and infrastructure build-outs in history,” said Opsware Chief Executive Officer Ben Horowitz said. “The addition of Opsware to the HP Software portfolio will make HP the obvious choice for powering the next generation of data centers to come.”

Opsware Acquires iConclude

Data center automation specialist Opsware Inc. has agreed to acquire IConclude Co. in a cash and stock deal valued at approximately $54 million. Opsware paid $30 million in cash, plus 3.39 million shares. iConclude makes software that helps companies troubleshoot and repair IT infrastructure problems. The two-year-old company based in Bellevue, Wash. has raised about $12 million in financing.

The acquisition is expected to allow Opsware’s data center automation tools to interoperate with systems management software from HP, IBM and BMC. “Not only does iConclude’s software make it easier for customers to automate with the existing Opsware suite, [but] it also orchestrates all of the other IT management tools they use, providing an unprecedented degree of efficiency and control,” Ben Horowitz, president and chief executive of Opsware, said in a statement.

Michael Ovitz Buys Opsware on The Dips

Famed Hollywood power broker Michael Ovitz has been a director of Opsware (OPSW) since its launch as Loudcloud. The company has since morphed from a managed hosting provider to a data center automation software maker. But Ovitz continues to like the stock, according to InsiderScore, which notes that the former Disney president bought 100,000 shares last week after the stock pulled back from a two-year high. Since May 2005, Ovitz has spent approximately $3.2M to acquire 547,200 shares of Opsware on the open market.