Press Release: July 23, 2007
Topics:

HP to Acquire Opsware Inc.

Acquisition positions HP to become a leader in high-growth data center automation software market
PALO ALTO, Calif. -- HP today announced that it has signed adefinitive agreement to purchase Opsware Inc. (Nasdaq: OPSW), amarket-leading data center automation software company, through acash tender offer for $14.25 per share, or an enterprise value (netof existing cash and debt) of approximately $1.6 billion on a fullydiluted basis.

Upon closing, theacquisition will enhance HP's portfolio of Business TechnologyOptimization (BTO) software. Combining Opsware's solutions withHP's enterprise IT management software will deliver a comprehensiveand fully integrated solution for IT automation. Opsware is thelatest in a series of strategic software acquisitions, includingMercury Interactive and Peregrine Systems, which expands HP'sleadership in BTO.

"The acquisition of Opswareis intended to enable HP Software to help our customers resolve oneof their critical pain points: controlling the increasingcomplexity and cost of managing the data center," said Thomas E.Hogan, senior vice president, Software, HP. "We expect Opsware'soutstanding team will help us drive leadership across our BTOofferings."

Opsware Chief ExecutiveOfficer Ben Horowitz said, "We are about to see one of the biggestapplication and infrastructure build-outs in history. The additionof Opsware to the HP Software portfolio will make HP the obviouschoice for powering the next generation of data centers tocome."

The acquisition of Opswareis intended to extend HP Software's capabilities to automate theentire data center – from initial provisioning of servers, networksand storage devices to managing ongoing changes and compliancerequirements – with integrated process automation, removing thelatency inherent in today's IT environments.

"Following last year'sacquisition of Mercury Interactive, the addition of Opsware isexpected to enhance HP's standing as one of the world's leadingsoftware companies and drive profitable growth for HP," said AnnLivermore, executive vice president, Technology Solutions Group,HP. "With this strategic acquisition, I believe customers will seeHP as the clear vendor of choice to help them transform how theymanage and automate IT to drive better business outcomes."

Following the close of thetransaction, Opsware will become part of the HP Software business.At that time, HP also expects to appoint Ben Horowitz to lead theBusiness Technology Optimization organization reporting to ThomasE. Hogan, senior vice president, HP Software.

The acquisition will beconducted by means of a tender offer for all of the outstandingshares of Opsware, followed by a merger of Opsware with an HPsubsidiary. The tender offer is subject to a number of customaryclosing conditions, including regulatory approvals, and is expectedto close before the end of HP's fourth fiscal quarter of 2007.

THIS PRESS RELEASE IS FORINFORMATIONAL PURPOSES ONLY AND IS NOT AN OFFER TO BUY OR THESOLICITATION OF AN OFFER TO SELL ANY SECURITIES. THE SOLICITATIONAND THE OFFER TO BUY SHARES OF OPSWARE COMMON STOCK WILL BE MADEONLY PURSUANT TO AN OFFER TO PURCHASE AND RELATED MATERIALS THAT HPINTENDS TO FILE WITH THE SECURITIES AND EXCHANGE COMMISSION.OPSWARE STOCKHOLDERS AND OTHER INVESTORS SHOULD READ THESEMATERIALS CAREFULLY BECAUSE THEY CONTAIN IMPORTANT INFORMATION,INCLUDING THE TERMS AND CONDITIONS OF THE OFFER. ONCE FILED,OPSWARE STOCKHOLDERS AND OTHER INVESTORS WILL BE ABLE TO OBTAINCOPIES OF THE TENDER OFFER STATEMENT ON SCHEDULE "TO," THE OFFER TOPURCHASE AND RELATED DOCUMENTS WITHOUT CHARGE FROM THE SECURITIESAND EXCHANGE COMMISSION THROUGH THE COMMISSION'S WEBSITE AT WWW.SEC.GOV. OPSWARE STOCKHOLDERS AND OTHER INVESTORS ALSO WILLBE ABLE TO OBTAIN COPIES OF THESE DOCUMENTS, WITHOUT CHARGE, FROMINNISFREE M&A INCORPORATED, THE INFORMATION AGENT FOR THEOFFER, AT +1 877 750 5838 OR BY EMAIL AT INFO@INNISFREEMA.COM, FROMJ.P. MORGAN SECURITIES, INC, THE DEALER MANAGER FOR THE OFFER, AT+1 877 371 5947, OR FROM HP. STOCKHOLDERS AND OTHER INVESTORS AREURGED TO READ CAREFULLY THOSE MATERIALS PRIOR TO MAKING ANYDECISIONS WITH RESPECT TO THE OFFER.

AboutOpsware

Opsware, a leading datacenter automation company, unlocks the promise of technology byaccelerating IT to zero latency. The company's software, theOpsware System, automates the entire data center, from provisioningto patching, configuration to compliance and discovery todeployment, turning data center operations into a competitiveadvantage for business. Opsware's technology is used by hundreds ofcompanies worldwide including banks, service providers, retailers,manufacturers and Internet companies with IT environments rangingfrom hundreds to tens of thousands of servers, network devices,storage devices and IT processes. More information on Opsware(Nasdaq: OPSW) is available at www.opsware.com.


This news releasecontains forward-looking statements that involve risks,uncertainties and assumptions. If such risks or uncertaintiesmaterialize or such assumptions prove incorrect, the results of HPand its consolidated subsidiaries could differ materially fromthose expressed or implied by such forward-looking statements andassumptions. All statements other than statements of historicalfact are statements that could be deemed forward-lookingstatements, including the expected benefits and costs of thetransaction; management plans relating to the transaction; theexpected timing of the completion of the transaction; the abilityto complete the transaction considering the various closingconditions, including those conditions related to regulatoryapprovals; any statements of the plans, strategies and objectivesof management for future operations, including the execution ofintegration plans; any statements of expectation or belief; and anystatements of assumptions underlying any of the foregoing. Risks,uncertainties and assumptions include the possibility that expectedbenefits may not materialize as expected; that the transaction maynot be timely completed, if at all; that, prior to the completionof the transaction, Opsware’s business may not perform as expecteddue to transaction-related uncertainty or other factors; that theparties are unable to successfully implement integrationstrategies; and other risks that are described from time to time inHP’s and Opsware’s Securities and Exchange Commission reports,including but not limited to the risks described in HP’s QuarterlyReport on Form 10-Q for the fiscal quarter ended April 30, 2007 andOpsware’s Quarterly Report on Form 10-Q for the fiscal quarterended April 30, 2007. HP assumes no obligation and does not intendto update these forward-looking statements.

© 2007Hewlett-Packard Development Company, L.P. The information containedherein is subject to change without notice. HP shall not be liablefor technical or editorial errors or omissions containedherein.

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