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| Cray acquisition by HPE | |
|---|---|
| Name | Hewlett Packard Enterprise–Cray acquisition |
| Type | Acquisition |
| Date | 2019–2020 |
| Acquirer | Hewlett Packard Enterprise |
| Target | Cray, Inc. |
| Value | US$1.3 billion |
| Status | Completed |
Cray acquisition by HPE
The acquisition of Cray, Inc. by Hewlett Packard Enterprise was a landmark consolidation in the supercomputer industry, announced in 2019 and completed in 2020. The transaction combined Cray's legacy in high-performance computing with HPE's enterprise platforms, affecting customers including national laboratories such as Oak Ridge National Laboratory, Lawrence Livermore National Laboratory, and agencies like the National Oceanic and Atmospheric Administration. Major industry players such as NVIDIA, Intel Corporation, and AMD were cited as ecosystem partners impacted by the deal.
Cray traced its heritage to founders like Seymour Cray and companies such as Control Data Corporation and Cray Research, with subsequent corporate evolutions involving SGI (company) and Tera Computer Company. HPE, spun out from Hewlett-Packard and led by executives linked to Meg Whitman and Antonio Neri, sought growth beyond servers into specialized markets. Prior to the acquisition, Cray supplied systems to projects including Summit (supercomputer) and collaborations with research institutions such as Los Alamos National Laboratory and Argonne National Laboratory. Competitors in the sector included IBM, Fujitsu, and Atos SE.
On September 17, 2019, HPE publicly announced its intent to acquire Cray in a deal valued at approximately US$1.3 billion. The announcement referenced strategic alignments with customers like NASA and National Institutes of Health that operate large-scale scientific facilities, and mentioned technology roadmaps involving partners such as Arm Ltd. and Broadcom Inc.. Financial stakeholders and boards of directors from both companies, including Cray leadership and HPE's board chaired by figures from Silver Lake (investment firm) discussions, coordinated the public disclosure.
The transaction structure involved a cash-and-stock acquisition with HPE agreeing to buy all outstanding Cray shares for US$35 per share in cash, plus an assumption of certain vested rights and equity awards. The deal required approval by Cray shareholders and customary closing conditions. Legal and advisory services were provided by major firms active in mergers and acquisitions, similar to deals overseen by firms working with Goldman Sachs, Morgan Stanley, and JPMorgan Chase. The acquisition was subject to regulatory filings with authorities like the Committee on Foreign Investment in the United States and other international bodies.
HPE framed the acquisition as a means to expand its presence in high-performance computing (HPC), exascale initiatives, and artificial intelligence workloads, citing synergies with HPE product lines including HPE Apollo and HPE's cloud strategies tied to HPE GreenLake. Cray's product portfolio—such as the Cray XC series and Cray's interconnect technologies—was positioned to complement HPE's mission-critical offerings and partnerships with accelerator vendors like NVIDIA Corporation and processor suppliers such as Intel Corporation and Advanced Micro Devices. Integration plans referenced legacy integrations similar to HPE's prior acquisitions involving Aruba Networks and EDS while aiming to maintain Cray's engineering centers and relationships with national laboratories and academic consortia like XSEDE.
The acquisition underwent reviews by authorities in the United States and other jurisdictions concerned with export controls, technology transfer, and competition. Agencies such as the Committee on Foreign Investment in the United States evaluated potential national security implications given Cray's contracts with the Department of Energy and defense-related programs. Additional clearance processes involved export licensing frameworks tied to International Traffic in Arms Regulations and collaboration with entities like European Commission competition authorities where applicable. Approval was obtained and the transaction closed in May 2020 following fulfillment of regulatory requirements.
Post-acquisition, HPE integrated Cray's interconnects, software stack, and system designs into its HPC portfolio while offering continued support to existing Cray customers, including installations at laboratories such as Oak Ridge National Laboratory (which hosted Summit (supercomputer)) and commercial research clients. Roadmaps indicated combined offerings for exascale-class systems, hybrid cloud deployments with Amazon Web Services and private cloud partners, and optimized stacks for machine learning frameworks like TensorFlow and PyTorch. Competitor responses from IBM and Fujitsu influenced procurement dynamics in government and academic sectors.
The financial markets reacted with scrutiny over HPE's strategic direction and debt profile; analysts from firms such as Morgan Stanley and Goldman Sachs provided coverage on projected earnings accretion and return on investment. Cray shareholders approved the transaction, and HPE's stock and bond markets reflected investor reassessment amid the COVID-19 pandemic. Industry commentators compared the deal to historical consolidations in the technology sector involving companies like Dell Technologies and Oracle Corporation.
Category:Acquisitions in 2020