HP Acquisition Rampage continues - ArcSight in the sights

HPs seemingly monopoly-like buying spree continues with ArcSight being the next billion dollar purchase.

Obviously because of the embarassing bidding war with Dell over 3PAR that I commented on in an earlier post, HP was keeping a low profile on the ArcSight acquisition. It wasn't even announced on the company intranet, I had to dig it out from the public internet site after reading it in the paper.  Perhaps given that this is "cybersecurity, cyberdefence and cyberwarfare company", it was thought a little cloak and dagger understatement was in order, although it appears from the stock chart, that someone got a whiff of the transaction in late August based on the huge one day jump in stock price prior to the official announcement today. Oh to be part of the Silicon Valley rumor mill...

You have to wonder what the market thinks of these aquisition. HPs share price has fluculated quite substantially for a big tech stock in the last months. Much of this was due to the volatile swings in the overall market since May, but the all knowing stock market is supposed to price in all known pricing factors such as multi-billion dollar acquisitions.

Maybe I should start trading these swings (see my Daily Income for Life blog). Its probable that I would make more money trading HP stock that I will in HP bonuses this year, given how much cash has been flying out the door to the moneyed mansions of Los Gatos, and not to mention the embarassing pay off of Mark Hurd. Oh, sorry Peter, we just spent our employee bonus pool on paying a huge premium for 3PAR, ArcSight, legal bills fighting our ex-CEO and trips to Hawaii for our Sales Team. Because, umm, our executive team gets their bonus based on how much market share we grow, and well this pile of cash is not growing market share unless we buy market share with it right?

Black humor aside, like 3PAR, HPs ArcSight acquisition does make commercial lsense. It gives HP some valuable intellectual property in the area of cyberthreft, cyberwarfare, and cyberespionage. Maybe it could even be used to keep tabs of the expense accounts of future CEOs? I think $1.2 billion is cheap to make sure the next one hired is honest. The HP board has already been through a spying scandal, so

Hang on, a guy in a trench coat and hat has just walked into my cube... later.