Hewlett Packard Enterprise buys converged infrastructure startup SimpliVity for $650 million

Hewlett Packard Enterprise, which split off from HP in 2015, today announced its latest acquisition, SimpliVity, a company that sells data center hardware that unites computing power and storage, which have traditionally been sold separately. HPE paid $650 million in cash for SimpliVity, and the deal is expected to close in the second quarter of HPE’s 2017 fiscal year, which ends on June 30, according to a statement.

SimpliVity had been in a position to go public, but competitor Nutanix did that first.

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“More and more customers are looking for solutions that bring them secure, highly resilient, on-premises infrastructure at cloud economics. That’s exactly where we’re focused,” HPE chief executive Meg Whitman is quoted as saying in the statement.

HPE will continue to sell its converged infrastructure products, like the HC 250 and HC 380, and by the end of this year HPE will offer “integrated” HPE SimpliVity systems atop HPE ProLiant servers, according to the statement.

This infrastructure has become popular, as companies seek to streamline their existing data center footprints and find alternatives to expensive storage from top providers like EMC and NetApp.

SimpliVity had raised more than $276 million in funding, and its valuation at one point exceeded $1 billion. Investors include Accel Partners, Charles River Ventures, DFJ Growth, Kleiner Perkins Caufield & Byers (KPCB), Meritech Capital Partners, and Waypoint Capital.

Founded in 2009 and based in Westborough, Massachusetts, SimpliVity has around 1,300 customers — such as MLB Network and T Systems — and has shipped 6,000 systems, according to a presentation on the acquisition.

Last year, HPE bought SGI.