HP has signed a definitive agreement to purchase datacentre automation vendor Opsware. HP said the $1.6bn deal will enhance its portfolio of business technology optimisation (BTO) software.

HP Software's senior vice-president, Tom Hogan, said that Opsware was the clear market leader in the data centre automation field.

"The market place and the customer is experiencing an explosion in complexity. The number of server farms doubles every five years and 80 percent of incidents, failures and downtime are driven by managing the dynamic nature of mobile devices, storage and servers," Hogan explained. He added that customers are seeking a suite of products that automates the management and proliferation of this infrastructure.

Opsware chief executive Ben Horowitz will lead HP's BTO organisation, reporting to Hogan.

"In 1995, 500,000 servers were shipped. If you fast forward to last year, seven million servers were shipped, a 14-fold increase in 10 years. As a result of this, labour costs have gone up six times and this has created a huge need for a system to run a modern data centre," Horowitz said.

Asked how much overlap there was between Opsware and the other IT management companies acquired by HP in the last few years, Hogan said, "That's one of the key things to consider in a deal and it drives the premium and the price. Just as with the Mercury acquisition, where we had very little overlap to rationalise , that's the case with Opsware."

The deal is scheduled to close before the end of HP’s fourth fiscal quarter in October, subject to regulatory approval.

HP has also announced its intention to acquire thin client vendor Neoware for $214 million.