HPE Announces Sale of Its Remaining H3C Stake for $643 Million

Hewlett-Packard Enterprise Company (NYSE:HPE) is one of the AI Stocks in Focus This Week. On December 1, Evercore ISI analyst Amit Daryanani reiterated an Outperform rating on the stock with a $28.00 price target.

The firm is positive on the stock following the sale of its remaining 9% stake in H3C, seeing the divesture as strategically aligned with HPE’s financial goals and integration roadmap.

Analysts discussed that the sale will be split amongst three buyers, including majority owner Unisplendour (UNIS). HPE will fully exit its stake through two sales totaling $1.3B, strengthening its balance sheet.

"In a filing this morning, HPE announced the sale of its remaining ~9% stake in H3C for ~$643M. The sale will be split among three buyers, including majority owner Unisplendour (UNIS), and is expected to close within the next 180 days pending regulatory and UNIS shareholder approval. The current transaction follows the announced sale of HPE’s ~10% stake of H3C two weeks ago and in aggregate, the two transactions will fully divest HPE from H3C and result in net proceeds of ~$1.3B to HPE’s balance sheet.”

Evercore ISI believes that the divesture is strategically positive, supporting its Juniper integration.

“Cash received from this transaction reflects the same valuation as the prior 10% sale and HPE’s original put agreement. This aligns with HPE’s broader strategy of deleveraging the business post Juniper close and allows management to further focus on integrating the two businesses."

Hewlett Packard Enterprise Company (NYSE:HPE), an American multinational technology company, provides high-performance computing systems, AI software, and data storage solutions for running complex AI workloads.

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