Hewlett-Packard announced mid-week that it is buying networking company 3Com for $2.7 billion. The deal has already been approved by the board of directors at both companies, and is expected to be completed within the first half of 2010. This deal will effectively beef-up HP's existing portfolio in the datacenter with switches, routers and security appliances from 3Com's product range.

Dave Donatelli, HP's vice president of networking, noted that, "By combining HP ProCurve offerings with 3Com's extensive set of solutions, we will enable customers to build a next-generation network infrastructure that supports customer needs from the edge of the network to the heart of the data center."

In a conference call with analysts, Donatelli pointed out that the combination of HP's superior distribution channels and 3Com's "best-in-class products" will result in a transformation in the networking world.

In addition, this move also will strengthen HP's position in China, which 3Com has spent years focusing on--3Com's H3C networking unit is a market leader there. The deal drove the share price of 3Com to $7.90--39 percent higher than its closing price on Wednesday.

For more on this story:
- check out this article at CNNMoney.com
- check out this article at Network World Asia

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