HP buys Eucalyptus to Accelerate Hybrid Cloud Adoption

Hewlett-Packard Co. is buying cloud-computing software developer Eucalyptus Systems as Chief Executive Officer Meg Whitman embarks on new acquisitions to bolster the computer maker’s businesses. HP announced that they have gone into a definitive agreement to acquire Eucalyptus, a provider of open source software for building private and hybrid enterprise clouds. 

After the transaction closes, Eucalyptus Chief Executive Officer (CEO) Marten Mickos, a respected leader in the cloud industry and a longtime advocate of open source, will join HP as senior vice president and general manager of the Cloud business, reporting to Meg Whitman, chairman, president and chief executive officer of HP. 

In this role, Mickos will lead the HP Cloud organization in building out the HP Helion portfolio, based on OpenStack® technology. Prior to Eucalyptus, Mickos was CEO of MySQL, which he grew from a garage start-up to the company providing the second most widely used open source software in the world. 

 

“The addition of Marten to HP’s world-class Cloud leadership team will strengthen and accelerate the strategy we’ve had in place for more than three years, which is to help businesses build, consume and manage open source hybrid clouds,” said Whitman. “Marten will enhance HP’s outstanding bench of Cloud executives and expand HP Helion capabilities, giving customers more choice and greater control of private and hybrid cloud solutions.”

 

“Eucalyptus and HP share a common vision for the future of cloud in the enterprise,” said Mickos. “Enterprises are demanding open source cloud solutions, and I’m thrilled to have this opportunity to grow the HP Helion portfolio and lead a world-class business that delivers private, hybrid, managed and public clouds to enterprise customers worldwide.”

Martin Fink, who currently leads HP’s Cloud business, will remain in his roles as chief technology officer of HP and director of HP Labs, where he will focus on innovation and creating groundbreaking solutions like The Machine. Fink will also continue to lead HP’s Network Functions Virtualization (NFV) business.

“We’ve said before that we believe the future of the Cloud is open source, and this transaction underscores our deep commitment to helping customers build enterprise-class, open clouds their way,” said Fink. “We’ve already seen significant momentum since launching HP Helion and have put in place an outstanding team. I’m confident that Marten, a fellow open source devotee, will continue to build out the HP Helion portfolio into the enterprise cloud offering of choice.”

 

Since introducing HP Helion in May, HP has grown share in private cloud and was ranked as the leader in the Forrester Wave report for Private Cloud Solutions.(1) In addition, HP recently announced an agreement to build and operate community clouds for enterprise customers in China, one of the fastest growing cloud markets in the world, and also announced HP Helion OpenStack Professional Services to help enterprises implement OpenStack technology–based clouds. HP is the leading code contributor to the next release of OpenStack code, scheduled for October.

HP expects the acquisition to close in the fourth quarter of its fiscal year 2014. Terms of the deal were not disclosed.

Eucalyptus, founded in 2009, provides technology that lets companies store, process and deliver computing data via the Internet. The Goleta, California-based company has raised $55.5 million in three financing rounds. Hewlett-Packard is paying less than $100 million, according to a person with knowledge of the situation.

The deal marks a return to mergers and acquisitions for Whitman after a dry spell following Hewlett-Packard’s $8.8 billion writedown of Autonomy Corp. in 2012, after buying the data software company for $10.3 billion a year earlier. Hewlett-Packard, the world’s second-largest seller of server computers, is seeking to add customers that are setting up their own cloud networks.

As part of the acquisition, Eucalyptus CEO Marten Mickos will join Hewlett-Packard as senior vice president. He takes over as general manager of Hewlett-Packard’s cloud-computing business, replacing Martin Fink, who previously led the cloud unit and will remain as Chief Technology Officer and director of HP Labs, the Palo Alto, California-based company said in a statement today. Mickos will report directly to Whitman.

Hewlett-Packard’s cloud-computing hardware, software and services are sold under the name HP Helion and compete with Internet-hosted services from Amazon.com, Google, and Microsoft Corp., as well as software sold by VMware, Citrix Systems, Red Hat and others.