HP announced that it has signed a definitive merger agreemen to purchase Neoware Inc. (Nasdaq: NWRE), a provider of thin client computing and virtualisation solutions.

The acquisition is part of HP’s strategy to expand in growth markets and further its leadership in personal computing. Acquiring Neoware is intended to accelerate the growth of HP’s thin client business by boosting its Linux software, client virtualisation and customisation capabilities, expanding its regional sales footprint and broadening its hardware portfolio.

“Our objective is to become the preferred brand of thin clients and software for virtualised client computing,” said Kevin Frost, vice president, Business Desktops, Personal Systems Group, HP. “Thin clients are an important component in today’s overall computing strategy and play a critical role in HP’s virtualisation strategy. Acquiring Neoware confirms our commitment to thin client computing and client virtualisation solutions.”

The transaction will combine the respective strengths of each company: Neoware’s Linux-based thin client solutions and software with HP’s thin clients based on Microsoft Windows XPe and Windows CE and its virtualised client solutions, such as blade PCs, blade workstations, virtual desktop infrastructure and server-based computing.

Following completion of the transaction, HP plans to integrate Neoware into the Business Desktop Unit of HP’s Personal Systems Group.