back to article HPE sells off 'non-core' software assets

On the day the Dell/EMC acquisition/merger completed, HPE announced it was selling off a load of non-core software assets in a “spin-off” merger with UK’s Micro Focus. HPE gets $2.5bn in cash and HPE shareholders will have a 50.1 per cent ownership of the new entity, which will continue to be called Micro Focus. In addition …

  1. Anonymous Coward
    Anonymous Coward

    sigh. Welcome to the inevitable

    Demise of HP. Naturally the 'execs' will not lose out in anyway shape or form while the poor people on the ground are up shit creek without a paddle (well those that remain)

    The execs will jump ship with a big wad of cash and proceed to rinse and repeat at some other unlucky company. Can it be Oracle please? I'd like to see Larry 'my yacht is bigger than yours' Ellison suffer for once.

    Sad to see a once proud company go this way.

    Posting AC as I'm an ex HP techy.

    1. Matt Bryant Silver badge
      Facepalm

      Re: AC Re: sigh. Welcome to the inevitable

      ".....the inevitable

      Demise of HP....." Yeah, I think I've been hearing of that "inevitable" and "imminent" demise with boring regularity since before the turn of the century.

      ".....I'm an ex HP techy." LOL, but at least you're not bitter.

  2. EarthDog

    Infrastructure dwindling? Just because data and computing is moved to "The Cloud" does not mean that infrastructure is dwindling. I fact it may grow. The cloud needs infrastructure. You can't cheat the laws of physics, data must be stored somewhere and CPUs must have a home as well. There is money to be made in infrastructure. I smell it.

    It also makes sense to spin off companies which are not core. HP Software has been struggling for sometime, managing software can be very difficult and HPE knows hardware but not software. Also, Whitman has said she wants a nimble company. A large company cannot be nimble. So paring companies down might be a good move.

    1. ToddR

      @Earthdog

      Infrastructure moves to the cloud: AWS, Oracle, AZure, Google, etc

      HPE cannot compete with ODM manufacturers such as Quanta, Tyan and Foxconn etc.

      The cloud companies, don't need the bells and whistles of a DL-380, so HPE servers are on a downward slow death as the ODM guys sell ever larger quantities to fewer massive cloud providers.

      Result HPE RIP

      1. Matt Bryant Silver badge
        Facepalm

        Re: ToddR

        "....The cloud companies, don't need the bells and whistles of a DL-380...." Good thing that HPE also make cookie tray servers, then! HPE will make a cookie tray to the customer's spec, in volume, and with the quality and management software that the white box churners can't.

        1. aazmi615@gmail.com

          Re: ToddR

          You forget about price. Cloud infrastructure is about cheap commodity infrastructure.

  3. Anonymous Coward
    Anonymous Coward

    > Infrastructure dwindling? Just because data and computing is moved to "The Cloud" does not mean that infrastructure is dwindling.

    Everybody just buys their capacity from everybody else.

    https://xkcd.com/908/

  4. AdamWill

    not quite

    "HPE gets $2.5bn in cash and a 50.1 per cent ownership of the new entity, which will continue to be called Micro Focus."

    This isn't quite right (as I understand it). HPE's *shareholders* get a 50.1% stake in Micro Focus. *HPE* does not. Basically what's happening is that Micro Focus is buying a bunch of HPE's (as you say) 'non-core software assets', but because the deal is so large, they can't just pay for them in cash; so instead, they compensate HPE's shareholders for the purchase with MF stock. But it's not HPE *itself* which gets the MF stock, it's HPE's shareholders directly. Rather than owning a stake in HPE which now owns a stake in MF, HPE shareholders directly become MF shareholders as well.

    1. Anonymous Coward
      Anonymous Coward

      Re: not quite

      Yep, it's a so-called Reverse Morris Trust deal rather like the HPE ES/CSC deal. Essentially HPE Software gets spun off into a subsidiary, which is then merged with a target company, in this case Micro Focus.

      The finances do indeed go to HPE Shareholders, not to HPE itself. When the deal completes HPE will not have any legal connection with Micro Focus. They may well have commercial connections though.

  5. Captain DaFt

    "Core"="Bone"

    "HPE announced it was selling off a load of non-core software assets"

    And once they've stripped this joint to the bone, they'll just throw the bone to the dogs.

    High fives and bonuses all around, and off other companies to lather, rinse, repeat.

    Does anyone in the upper ranks actually run a company any more, or is it all just "asset monetizing" until the company is gone?

  6. Anonymous Coward
    Anonymous Coward

    For those of you familiar with HPE, you'd realise that software going will have almost zero impact on what remains from a day to day perspective. EG and software barely interacted anyway. It does make HPE a manageable acquisition target though. Someone like MS might fancy buying the company that makes all the servers for its' cloud anyway.

    1. ToddR

      @AC

      It's a nice idea, but MSFT can buy servers from anyone. Nothing special about HPE's offerings, so why waste the cash.

      1. Anonymous Coward
        Anonymous Coward

        Well they are buying them at the moment, so there must be some reason.

    2. Anonymous Coward
      Anonymous Coward

      Yep. The software sales were tiny. I could post actual numbers, but I don't know which information is due to my former positions versus public information.

      Article kicked off with a comment about slimming down for a sale, but makes no attempt to say who would be buying. The HPE / Cisco merger concept had been floating around a long time, but Dell / Cisco had always seemed to make more sense. Perhaps moreso now with Dell / EMC.

  7. Anonymous Coward
    Anonymous Coward

    And Meg gets a load more shares to flog to fund her political ambitions

  8. ToddR

    Are Meg Whitman and Mary Berry the same person?

    Are Meg Whitman and Mary Berry the same person?

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