Palo Alto, Calif. — Considering the recent burst of merger and acquisition activity in the content management space, Palo Alto, Calif.-based Hewlett Packard’s decision to acquire Lexington, Ky.-based Exstream Software LLC is hardly a shock. Indeed, given the way Exstream’s strength in document automation complements HP’s well-known imaging and document output abilities, the synergies the combined companies would enjoy are readily apparent.

This deal comes soon after another notable acquisition in the content management space. In December, Hopkinton, Mass.-based EMC Corp. acquired Carlsbad, Calif.-based Document Sciences Corp. for $85 million. While financial terms of the deal were not disclosed, upon completion of the deal, privately held Exstream and its more than 300 employees will be integrated into the Web Services and Software business unit within the Imaging and Printing Group (IPG) of HP.

 “We expect that the acquisition of Exstream will allow HP to address a broader set of customers and be a strong leader in the fast-growing document automation market,” says David Murphy, SVP of the unit.

Specifically, the addition of Exstream will augment hardware-centric HP’s presence in the higher-margin world of variable data publishing (VDP), which uses software to facilitate highly personalized, multi-channel communications. Murphy says that the combination of Exstream’s enterprise software with HP’s printing infrastructure will enable customers to design and create highly customized documents using rich media. “VDP will be an integral part of HP’s enterprise printing strategy,” he says. “This strategy seeks to extend to digital content creation and output via a variety of publishing platforms.”

Richard Troska, president and CEO of Exstream, says that the increased use of content management solutions coincides with a wider push toward productivity, which includes the use of business intelligence and enterprise resource planning. “There is a focus on improved process management across infrastructures, across systems and across organizations,” he says. “As customers look to make these improvements, they see the importance of how document automation can improve these overall business processes.”

HP’s Murphy also stresses the importance of content management solutions to productivity. “Customers can expect a robust documentation platform to improve their workflows,” he says.

An Exstream spokesperson told Insurance Networking News that the company would reserve further comment until the deal closes, which is expected in the second quarter of 2008.

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