HP Enterprise said to near deal for supercomputer maker Cray

Hewlett Packard Enterprise Co. planned to acquire supercomputer maker Cray Inc. (AFP pic)

NEW YORK: Hewlett Packard Enterprise Co. is in advanced talks to acquire US supercomputer maker Cray Inc., according to people with knowledge of the matter.

A deal could be announced as soon as this week, the people said, asking not to be identified as the information is private. Shares of Cray have risen 11% in the past year, giving it a market value of about US$1.2 billion.

Buying Cray would help HP Enterprise strengthen its position in high-end computer systems against International Business Machines Corp. The purchase could become HP Enterprise’s biggest since it started trading in 2015, surpassing its acquisition of Nimble Storage Inc. for about US$1 billion more than two years ago, according to data compiled by Bloomberg.

No final agreements have been reached, and the timing could still be delayed, the people said. A spokeswoman for HP Enterprise declined to comment, while a representative for Cray didn’t immediately respond to a request for comment.

HP Enterprise has mostly been paring down since it was created from the breakup of Hewlett-Packard Co. In 2017, it completed a spinoff and merger of its enterprise services business with Computer Sciences Corp. It’s also separated some software assets in an US$8.8 billion deal with UK- based Micro Focus International Plc.

Loss-making Cray traces its roots back to a company founded in 1972 by Seymour Cray, known as the “father of supercomputing.” This month, it signed a deal with the US Department of Energy’s Oak Ridge National Laboratory to build a new US$600 million system for research on artificial intelligence, weather, subatomic structures, genomics and physics.

HP Enterprise’s own high-end computer systems are used by the University of Notre Dame, the Pittsburgh Supercomputing Center and chemical giant BASF SE, according to its website. Last year, it won a US$57 million contract to provide supercomputers to the US Department of Defense for helicopter design and weather forecasting.