DOJ Suit Seeks to Block HPE Acquisition of Juniper; Wireless Competition Cited
In one of the first big antitrust decisions in the second Donald Trump administration, the DOJ sued to block Hewlett Packard Enterprise’s proposed $14 billion buy of Juniper Networks. The department said its decision, announced Thursday, was based on the proposed deal's competitive effects on the wireless local area network market. Both companies said they will contest the decision, which they called “substantially disconnected from market realities.” The acquisition was pending for more than a year.
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HPE is the second-biggest provider of enterprise-grade WLAN solutions in the U.S., and Juniper is the third, DOJ said. Filed in the Northern District of California, the complaint “alleges that the proposed transaction would eliminate fierce head-to-head competition between companies, raise prices, reduce innovation, and diminish choice for scores of American businesses and institutions,” DOJ said.
Juniper has been “a disruptive force that has grown rapidly from a minor player to among the three largest enterprise-grade WLAN suppliers in the U.S.,” the department said: “Juniper has also introduced innovative tools that have materially decreased the cost of operating a wireless network for many customers. This competitive pressure has forced HPE to discount its offerings and invest in its own innovation.”
In a joint statement, the companies said, “We believe [DOJ's] analysis of this acquisition is fundamentally flawed, and we are disappointed in its decision.” Consistent with the conclusions drawn “by all other major antitrust regulators who have reviewed the deal, this transaction brings together two complementary networking offerings and will create a networking player with the scope and scale to more effectively compete with global incumbents.” The deal was already approved by the European Commission and U.K. Competition and Markets Authority and in every country where they sought clearance, other than the U.S. and Israel, the companies said.
Juniper and HPE said the combined entity would not be positioned to harm WLAN competition. “As customers shift to AI and cloud-driven business strategies for secure, unified technology solutions to protect their data, barriers to entry have decreased and expansion and competition for WLAN has intensified,” they said: “WLAN is an extremely competitive market with a broad set of players, all of whom are fighting for business and winning bids in competitive … processes."
Acting Attorney General James McHenry is leading DOJ with the nomination of Pam Bondi still before the Senate. CTA CEO Gary Shapiro said Wednesday that the tech industry hopes for a more merger-friendly environment under Trump than was the case during former President Joe Biden's administration (see 2501290042).