HP to buy Peregrine Systems

Hewlett-Packard has agreed to purchase Peregrine Systems, the once-troubled asset management software developer that has been rebuilding its standing since emerging from bankruptcy in 2003.

HP said the $425 million transaction will close by the first quarter of 2006. Peregrine’s main product offerings are AssetCenter, which provides asset tracking and expense control, and ServiceCenter, which aims to help information technology organizations manage services.

Todd DeLaughter, vice president and general manager of HP’s Management Software Business, said AssetCenter “plugs one of the larger gaps we have had.” He said the product will be integrated into HP OpenView, adding that the combination will help chief information officers track utilization, manage IT resources and link into financial reporting systems.

DeLaughter, however, noted overlap between Peregrine’s ServiceCenter and HP’s Service Desk component. He said HP will support existing ServiceCenter products and those currently in development. In addition, the companies will devise a road map for merging their technologies in next-generation releases, he added.

Pete Karns, industry marketing manager at MRO Software, a Peregrine rival, said he believes that HP and Peregrine may face some technology integration challenges.

“While Peregrine and HP individually provide good solutions, the underlying technologies have not been rewritten onto a modern platform, and we believe that could present some integration issues for both HP and potential customers, today and into the future,” he said.

Peregrine has been working to overcome setbacks and re-establish itself in the federal market. The company filed for Chapter 11 bankruptcy protection in September 2002 and emerged from bankruptcy about a year later.

Tony Ambegaoker, executive vice president of IDL Solutions, said Peregrine has been through “some ups and downs,” but added that product quality has remained consistent. IDL Solutions, an 8(a) IT services firm, partners with Peregrine in the federal market.

“Adding the stability of something like HP behind them…will only strengthen people’s confidence in the product set,” Ambegaoker said.

DeLaughter said HP will continue Peregrine’s emphasis on the government market and use Peregrine’s capabilities to expand OpenView’s reach in the public sector.