US DOJ sues to block Hewlett Packard Enterprise’s $14 billion Juniper deal

The DOJ argued that the acquisition would destruct contention and would pb to lone 2 companies — Cisco Systems and HPE — controlling much than 70% of the U.S. marketplace for networking equipment.

More than a twelvemonth ago, the server shaper said that it would bargain Juniper Networks for $14 cardinal successful an all-cash deal, arsenic it looks to spruce up its artificial quality offerings.

“The DOJ’s assertion that the WLAN (Wireless Local Area Network) marketplace is composed of 3 superior players is substantially disconnected from marketplace realities,” the companies said successful a associated statement.

The firms added that they would support the deal, arguing that the acquisition volition bring unneurotic 2 complementary networking offerings to amended vie with planetary incumbent players.

“Juniper has besides introduced innovative tools that person materially decreased the outgo of operating a wireless web for galore customers. This competitory unit has forced HPE to discount its offerings and put successful its ain innovation,” the DOJ said successful its complaint.

Stiff contention from Juniper forced HPE to merchantability its products astatine a discount and walk to present caller features nether the “Beat Mist” campaign, named aft the networking cogwheel company’s rival product, the DOJ wrote.

“HPE and Juniper volition acquisition its pretrial and proceedings processes implicit the adjacent astir 8 months anterior to the implicit walk-away day successful October – which we deliberation gives suffice clip for a proceedings to commence,” Evercore ISI expert Amit Daryanani said.

UK’s Competition and Markets authorization and the European Union person cleared the deal.