Hewlett-Packard buys 'thin client' maker

PALO ALTO, Calif., July 23 (UPI) -- Hewlett-Packard Inc. said Monday it would buy Neoware Inc., a U.S. maker of computer terminals that do most of their processing on servers or the Internet.

The $214 million deal, priced at $16.25 a share, is 6.6 percent more than Neoware closed on the Nasdaq Stock Market Friday.

Neoware, of King of Prussia, Pa., closed up 57 cents, or 3.74 percent, Monday at $15.81 on the Nasdaq Stock Market.

Hewlett-Packard, of Palo Alto, Calif., lost 11 cents, or 0.23 percent, to $48.43 on the New York Stock Exchange.

Neoware's "thin client" terminals connect to servers and Web browsers, letting users perform word processing or other tasks as they do with personal computers but with most processing occurring on the server.

This removes the need for local storage drives.

The deal will combine Neoware's Linux-based thin client products and services with HP's thin clients based on Microsoft Windows products and services, HP said.

Neoware will become part of HP's Business Desktop unit.

Thin-client shipments rose 21 percent to 2.8 million worldwide in 2006, technology-research firm IDC said. IDC predicted the category would grow 21.5 percent in the next three years.