Wachtell, Skadden called in for Hewlett Packard Enterprise’s $14bn Juniper acquisition

Freshfields and Covington also advise on deal highlighting increased appetite for big ticket deals after slump in 2023

A raft of leading firms have been called in to advise on Hewlett Packard Enterprise’s $14bn acquisition of networking gear vendor Juniper Networks, in a deal that signals a growing appetite for dealmaking in the tech industry after a sharp drop in activity last year.  

Wachtell Lipton Rosen & Katz, Covington & Burling and Freshfields Bruckhaus Deringer are advising Hewlett Packard Enterprise (HPE) on the matter, while Juniper is being counselled by Skadden Arps Slate Meagher & Flom.  

HPE has agreed to acquire Juniper for $40 per share in cash, representing a premium of more than 30% on the company’s stock price before reports of a possible deal.  

The deal will see HPE, which primarily sells equipment for data centres, double its existing networking business amid demand for ever faster communications within and between servers from AI companies.  

Wachtell’s team was led by corporate partners Benjamin Roth, Raaj Narayan, Steven Green and of counsel Andrew Brownstein. It also included partners Ilene Knable Gotts (antitrust); Adam Shapiro (executive compensation and benefits); Emily Johnson (finance), and T. Eiko Stange (tax). IP of counsel Selwyn Goldberg also worked on the deal.  

The firm’s longstanding relationship with Hewlett Packard previously saw it counsel the company on its separation into HPE and its PCs and printer arm HP in 2015 and the $1bn purchase of Nimble Storage two years later. It also acted for HPE on its $1.3bn acquisition of supercomputer business Cray in 2019.  

The Freshfields team was led by antitrust partners Jennifer Mellott – who heads the UK firm’s Washington DC office – Alan Ryan, Thomas Janssens and Martin McElwee, and included antitrust partners Mary Lehner, Rikki Haria and Ninette Dodoo. 

Meantime the Skadden team acting for Juniper included corporate partner Amr Razzak, counsel Christopher Hammond and associates Maggie Yiin and Alex Lyass; executive compensation and benefits partner Joseph Yaffe and counsel Kristin Davis; IP and technology counsel Pramode Chiruvolu and associate MacKinzie Neal; antitrust/competition partners Steven Sunshine, Maria Raptis and Andrew Foster; national security partner Brian Egan; and labour and employment law partner Annie Villanueva Jeffers and counsel Ryne Posey. 

Wachtell, Skadden and Freshfields were all among the top 10 in LSEG’s global M&A legal advisor rankings by deal value for 2023, when worldwide M&A activity fell to a 10-year low of $2.9trn. Wachtell came in fifth behind 2022’s top firm Sullivan & Cromwell, working on deals worth $310.3bn, followed by sixth-placed Skadden ($303.1bn) and Freshfields in seventh place ($278.3bn). Covington was not among the top 25 firms.  

Despite a few big-ticket deals, the value of M&A in the tech industry plunged 47% last year to $370.5bn, held back by a combination of ongoing interest rate increases, persistently high inflation rates and antitrust scrutiny from regulators.  

The largest tech deal announced last year was the $29bn acquisition of data and security software company Splunk by Juniper’s rival Cisco, which saw Simpson Thacher & Bartlett called in as Cisco’s legal counsel and Cravath Swaine & Moore act as regulatory counsel. Skadden advised Splunk.  

HPE said adding Juniper to its portfolio would bolster margins and speed growth, adding it expected the deal would lead to $450m in annual cost savings within three years of completion. 

“HPE’s acquisition of Juniper represents an important inflection point in the industry and will change the dynamics in the networking market and provide customers and partners with a new alternative that meets their toughest demands,” said Antonio Neri, HPE’s president and chief executive.   

“This transaction will strengthen HPE’s position at the nexus of accelerating macro-AI trends, expand our total addressable market, and drive further innovation for customers as we help bridge the AI-native and cloud-native worlds, while also generating significant value for shareholders.”  

JP Morgan Securities and Qatalyst Partners served as HPE’s financial advisors, while committed financing for the transaction has been provided by Citigroup Global Markets, JPMorgan Chase Bank and Mizuho Bank. Goldman Sachs acted as Juniper’s exclusive financial advisor. 

The deal is expected to close late this year or early next year, subject to regulatory approvals and approval from Juniper shareholders.  

Email your news and story ideas to: [email protected]