HP has announced its intention to acquire ArcSight with a definitive agreement signed for $43.50 per share, or an enterprise value of $1.5 billion (£972 million).

The combination will see HP move into the log management and SIEM (security information and event management) arena, as well as further expanding HP's software and security portfolio.

The acquisition will be conducted by means of a cash tender offer for all of ArcSight's outstanding shares of common stock. The closing of the deal, which is subject to customary closing conditions, is expected to occur by the end of the calendar year.

HP has already acquired 3Com, Palm and Fortify this year. Rumours of a bid for anti-virus vendor McAfee were ended when Intel completed a deal last month.

HP said that the ArcSight technology is highly complementary with its existing security portfolio of hardware, software and services. Bill Veghte, executive vice president of software and solutions at HP, said: “From a security perspective, the perimeter of today's enterprise is porous, putting enormous pressure on clients' risk and compliance systems.

“The combination of HP and ArcSight will provide clients with the ability to fortify their applications, proactively monitor events and respond to threats.”

Tom Reilly, president and CEO of ArcSight, said: “HP's acquisition of ArcSight will enable the creation of a new type of security solution, one that serves the modern enterprise. By combining ArcSight's Enterprise Threat and Risk Management Platform with HP's breadth of application development and operations management solutions, HP will be able to offer an integrated security platform that delivers broader visibility, deeper context and faster remediation of enterprise wide security and risk related events.

“In a world where perimeter security is no longer enough, businesses need this holistic approach to securing their networks, applications and sensitive data.”