HP Plans to Acquire Peregrine and AppIQ

Hewlett-Packard Co. on Monday said it agreed to buy Peregrine Systems Inc. for $425 million in cash to build its portfolio of computer systems management software.

HP also said that it agreed to buy privately held AppIQ, a maker of storage area network management software that helps large business customers manage computer servers and storage. Financial terms weren’t disclosed.

“These relatively small acquisitions are in line with [HP’s] recent printer-oriented purchase of Scitex Vision, which expanded [HP’s] technology and product set but did not change the company’s focus,” wrote Shannon Cross of Cross Research in a note to clients.

Ann Livermore, head of HP’s Technology Solutions Group, which includes its server, storage and computer services businesses, said the acquisitions would help the company stack up better against rivals BMC Software Inc., Computer Associates Inc. and EMC Corp.

The Peregrine acquisition would fill a void that Palo Alto-based HP has in its OpenView software that helps manage computer systems, Livermore said.

The two acquisitions, when completed, would help HP’s customers cut information technology costs by automating a lot of processes that are now labor-intensive, Livermore said.

The Peregrine deal is expected to close in the first calendar quarter of 2006, pending approval by Peregrine shareholders and other customary closing conditions.

HP, the No. 2 computer maker, would acquire San Diego-based Peregrine for $26.08 a share.

That represents a 37% premium to Peregrine’s closing price of $19.10 on Friday.

Shares of Hewlett-Packard rose 54 cents to $28.88. Shares of Peregrine climbed $6.22 to $25.32.