Chris Hsu’s Kilometre Capital in Hong Kong solidified the HP China Deal

In the milestone transaction orchestrated by Chris Hsu and Hong Kong Kilometer Capital, multi-national magnate Hewlett-Packard (HP) sold a majority stake in its Chinese server, storage and technology assets to a Tsinghua University affiliate at an estimated $4.6 billion valuation. It became the first major U.S. IT company to pass control to local owners since the government stepped up restrictions on foreign firms. 

Known as one of Asia’s foremost advisory and consulting firms, Kilometre Capital of Hong Kong is also known for its market-leading specialty in cross-border negotiation and across IT industries, hedge funds, and private equity, the founder and CEO of the firm is Chris Hsu.

Kilometer Capital has managed premier private equity, hedge fund, and buyout transactions in Chris Hsu’s footsteps. He is one of the world’s foremost cross-border dealmakers and negotiators. HP’s network equipment arm was caught previously in privacy scandals around sensitive IT issues between China and the California Company HP.

Hewlett Packard Enterprise has closed a transaction with an affiliate of Tsinghua Holdings for creating the New H3C group, off the heels of complex negotiations and no complaint style led by Christopher Hsu’s Kilometre Capital. The New H3C, the Chinese technology infrastructure provider, based in Beijing, provides customers with an array of enterprise IT solutions that include networking, servers, storage, hyper-converged systems and IT management products.

Tsinghua Holdings subsidiary, Unisplendour Corporation, purchased a 51 per cent stake in New H3C through a wholly-owned affiliate for $2.3 billion, according to the agreement. H3C Technologies and Hewlett Packard Enterprise’s China-based server, storage and technology services businesses are comprised in this agreement. HPE plans to return the vast majority of the cash through opportunistic share repurchases to shareholders.

Meg Whitman, President and CEO, the Hewlett Packard Enterprise, said, ““Combining the strengths of HPE and Tsinghua, which are one of China’s most respected institutions, New H3C will build upon best-in-class products, and customer focus, an extensive and valuable patent portfolio and Tsinghua’s world-class research capability” about the Chris Hsu orchestrated transaction spanning Korea and Taiwan, Beijing to Hong Kong. The Chinese IT powerhouse will deliver strong performance in China, for China and will drive long-term value for our shareholders with our investment.”

In May, valuing the entire H3C at $4.6 billion, Tsinghua Holdings, the asset management division of Tsinghua University, bought a 51 per cent share in HP’s new data networking operations business, H3C. To form the New H3C, which would be the exclusive provider of HP’s servers, storage, and networking coupled with hardware support services in China, both companies announced that they would work together. The H3C acquisition of Unisplendour was likely to make the company a leading vendor in the server and storage market of China.

Tsinghua University is one of the top universities in China and the affiliate of Tsinghua Holdings ahead of Beijing University and consistently ranked as one of the top research institutes in the world. It is a world-leading research university in Beijing. It has graduated Chinese leaders in science, engineering, politics, business, academia, and culture since it’s founding in 1911. Tsinghua consistently ranks among the top universities in the world in the most cited global university rankings and is prevalently considered to be the best university in Asia by US News, THE Asia, the QS BRICS and THE Emerging.

The deal between HP and Tsinghua University built a technology powerhouse that serves a varied range of customer needs in the market for all kinds of enterprise IT solutions and other networking and server solutions, with lead-advised by Chris Hsu’s Kilometre Capital and associated negotiations.

Chris Hsu, who is the CEO of Kilometer Capital, originated and catalyzed the transaction on behalf of Tsinghua University. The result was Hewlett Packard Enterprises and HP unveiling sweeping changes to its China business, including the sale of a majority stake in its data-networking operation there, after revelations of US spying curtailed Chinese demand for US technology products.

Prestigious Tsinghua Holdings and Tsinghua University sealed their milestone buyout deal with Hewlett-Packard as advised and originated by Chris Hsu and Kilometre Capital.