Computer technology company HP Inc. (NYSE: HPQ) is set to acquire video and voice solutions company Poly (NYSE: POLY) in a deal said to accelerate HP’s growth strategy, particularly for the hybrid working environment brought on by the pandemic.
Pursuant to the deal, announced March 28, HP will purchase Poly for $3.3 billion cash, including Poly’s net debt; this is the equivalent of $40 per share.
The acquisition of Poly, formerly known as Plantronics and Polycom, is crucial as the company’s offerings are important for people working from home. The onset of work from home has increased demand “for technology that enables seamless collaboration across home and office environments.” The companies also note that offices are “being reconfigured to support hybrid work and collaboration,” including allowing meeting rooms to have video capabilities. Therefore, this acquisition helps strengthen HP’s “industry opportunity in hybrid work solutions, and positions the company for long-term sustainable growth and value creation.”
“The rise of the hybrid office creates a once-in-a-generation opportunity to redefine the way work gets done,” Enrique Lores, President and CEO of HP, said in a press release. “Combining HP and Poly creates a leading portfolio of hybrid work solutions across large and growing markets.”
Dave Shull, Poly CEO and President, added: “The combination gives us an opportunity to dramatically scale, reaching new markets and channels, supercharging our innovation with a like-minded partner,” Dave Shull, Poly CEO and President, said in a statement. “This transaction offers compelling and certain value for our shareholders and speaks to the hard work done by our teams to become a recognized leader in helping businesses everywhere meet the challenges of a generational disruption in the way people work.”
Poly and HP will “deliver a complete ecosystem of devices, software, and digital services to create premium employee experiences, improve workforce productivity, and provide enterprise customers with better visibility, insights, security, and manageability across their hybrid IT environments.”
The deal is expected to close by the end of 2022, subject to regulatory and Poly stockholder approval.
HP is represented by Ropes & Gray LLP and Davis Polk & Wardwell LLP. HP’s financial advisors are Goldman Sachs & Co. LLC and Foros Securities LLC. Poly is represented by Wilson Sonsini Goodrich & Rosati and its financial advisor is Morgan Stanley & Co. LLC.
Prior to the announcement, HP’s stock was valued at $39.84 on March 25. When the deal was announced on March 28, its stock was valued at $38.75. Two days later, its stocks closed at $38.84 on March 30. Poly’s stock was $26.20, $39.99 and $39.44 on those aforementioned dates. In comparison, Poly’s stock jumped after the announcement.