Dell said Monday it's buying 3Par Inc., a maker of data storage equipment for businesses, for about $1.13 billion US in an all-cash deal.

The offer is worth $18 per share, an 87 per cent premium over Friday's closing price of $9.65.

Dell Inc. is paying $1.13 billion US in cash for 3Par, a maker of data storage equipment for businesses, whose technology is especially suited for cloud computing. (Elise Amendola/Associated Press)

3Par shares were higher by $8.32 US, or 86 per cent, at $17.97 late in the trading session on the New York Stock Exchange. Dell's fell eight cents to $11.93.

Dell, based in Round Rock, Texas, said it expects the deal to add to profits by 2012. It also planned to invest in added engineering and sales resources at 3Par.

Dell said 3Par's technology is particularly suited to "cloud computing," where many customers may share the capacity of a data centre over the internet.

The deal has been approved by the boards of both companies and was expected to close this year.

3Par, of Fremont, Calif., makes systems designed for efficient use of available storage space through so-called "thin provisioning," which makes it easier to add capacity when needed.

3Par had an early lead in this technology, but competitors like NetApp Inc., EMC Corp., IBM Corp. and Hewlett-Packard Co. are starting to catch up. Dell already resells EMC's products under the Dell/EMC brand.

With files from The Associated Press