Hewlett Packard Enterprise (HPE) doubled down on its edge-to-cloud strategy today announcing the acquisition of Silver Peak in a $925 million deal aimed at bolstering its SD-WAN offering.

Combining Aruba's SD-branch capabilities with Silver Peak's SD-WAN and WAN optimization offerings will allow HPE to better address the changing needs of distributed enterprises, the company claims.

"Silver Peak's innovative team and technology bring critical capabilities that will help our customers modernize and transform their networks to securely connect any edge to the cloud," HPE CEO Antonio Neri said during a webcast following the news.

The acquisition marks HPE's second investment in SD-WAN technologies since it acquired Aruba Networks for $3 billion in 2015. Silver Peak also feeds into HPE's $4 billion strategic investments in intelligent edge technologies, announced in 2018.

The acquisition also comes at a unique moment with a global pandemic forcing enterprises to change approaches to the WAN, edge, and the cloud, according to Keerti Melkote, Aruba's founder and president of HPE's Intelligent Edge division

"What Silver Peak does is it complements the [Aruba] Edge Services Platform and adds the SD-WAN functionality, in addition to the wired and the wireless functionality, to the picture," he said. "With this, we now have the opportunity to present a completely unified and comprehensive end-to-end solution to our customers all the way from the edge – be it in a campus location or a branch office, a home office, or any other edge location such as a retail store, a hospital, a factory floor, stadium – and take this edge location and connect that directly to the cloud and to the data centers in a secure manner."

While Aruba has already developed and launched its own SD-WAN capabilities with its Aruba Central platform, Melkote explained that Silver Peak's contributions will enable customers to extend those capabilities beyond the branch and into the cloud, thereby accelerating access to software-as-a-service applications.

"With Aruba's extensive go-to-market, we will further accelerate our ability to drive faster adoption of these transformational technologies," Silver Peak founder and CEO David Hughes said in a statement.

The deal is expected to close during the fourth quarter of HPE's 2020 fiscal year.

Silver Peak to lift Aruba to the SD-WAN Summit

Strategically, the acquisition stands to improve Aruba's standing in the crowded and highly competitive SD-WAN market. Gartner classified the vendor as a niche player in its 2019 Magic Quadrant WAN Edge Infrastructure report published in December.

This should, however, come as no surprise. Aruba is best known for its Wi-Fi and LAN switching technologies, and only recently entered the contentious WAN market in 2018. Gartner suggests that this lack of market strength could hamper the vendor's ability to compete.

By contrast, Silver Peak is a well-established player in the SD-WAN market with more than 1,500 SD-WAN customers around the world, and was recognized as a leader in the same Gartner report.

The acquisition will address the challenges identified in the Gartner report and expand Aruba's addressable market beyond LAN and wireless, according to Melkote. Combined, these technologies represent a $32.7 billion market, he said.