Hewlett-Packard is acquiring wireless networking company Aruba Networks. The company informed that Aruba will be acquired in a deal valued at $2.7 billion. Aruba Networks is a networking vendor selling enterprise wireless LAN and edge access networking equipment. Business of Aruba has grown because more people are making use of mobile devices at work, school and elsewhere.

This deal will possibly aid HP to compete with tech competitors like Cisco Systems. HP could also be helped to gain access to Asian markets, mainly in China. According to UBS analyst Amitabh Passi, Cisco presently sells about 50% of all commercial wireless networking gear worldwide. It has been estimated that HP and Aruba will collectively account for 20% of global sales for such systems.

According to HP, it is looking to increase its tech portfolio for business customers when it is getting ready to split into two companies. One in two companies will concentrate on selling computer systems and software to businesses and other focus on selling personal computers and printers.

"Buying Aruba gives HP a faster growing, higher margin business that fills a portfolio need without `betting the ranch", said Bernstein analyst Toni Sacconaghi.

Back in 2001, HP spent about $11 billion for British software maker Autonomy. For deal with Aruba, HP is spending 24.67 in cash for each Aruba share. The deal has been approved by boards of both the companies. Aruba earned $729 million in sales in 2014.

Shares of Aruba Networks Inc. dropped 40 cents or 1.6 percent, to $24.41 in midday trading, whereas shares of HP dropped 19 cents to $34.65. HP has worked hard to adapt to mobile and online computing.