Data Center Knowledge » Opsware

HP Buys Opsware for $1.6 Billion

Rich Miller — Mon, 23 Jul 2007 12:44:10 +0000

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 was founded in September 1999 by Horowitz and Netscape pioneer Marc Andreessen, and in 2000 was one of the last tech IPOs before the dot-com crash. In a blog post this morning, Andreessen reflects on the company’s history and the significance of HP”s purchase of Opsware:

For Opsware, this means that our vision will now get delivered at much higher scale — being part of HP’s software business will ensure that our software will be used by a much larger number of organizations and have an even more dramatic impact on the industry than we would possibly have been able to reach by ourselves over the next several years. For HP, this means that HP instantly becomes the clear and overwhelming market leader in automation software for modern datacenters and computer systems.

Once the transaction closes in the fourth quarter of 2007, Opsware will become part of the HP Software business, and Horowitz will lead the Business Technology Optimization organization, reporting to Hogan.

Opsware Acquires iConclude

Rich Miller — Tue, 06 Mar 2007 23:46:22 +0000

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

Rich Miller — Wed, 21 Jun 2006 16:17:10 +0000

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.

InsiderScore is an insider trading data monitoring and intelligence service, and part of the FindProfit.com network of financial sites. Bill Martin, editor of investment newsletter FindProfit.com, believes that “further upside” is ahead for Opsware over the next 18 months and that analyst consensus revenue estimates for next year are “materially low.”

“Opsware’s business is continuing to gain momentum, as its business starts moving up the hockey stick growth curve, notes Bill Martin, editor of investment newsletter FindProfit.com. “First-quarter revenues were well above street estimates, and the company hiked its full-year revenue guidance. While those top-line gains have yet to benefit the bottom line, it’s for a good reason: Opsware is investing heavily in sales & marketing and product development as it tackles a significant market opportunity.”

Many long-time Internet users may remember Martin as a founder of Raging Bull, the wildly popular stock message board.