HP officials said in a statement announcing the deal that they expect the purchase to boost HP's portfolio of IT management software and services.

"Today, we are combining two market-leading businesses to create the most powerful management software portfolio in the industry," said Mark Hurd, HP's CEO and president. "Together, they will help customers cut their IT costs, speed the delivery of new services and drive profitable growth at HP. We expect this important acquisition to deliver significant value for our shareholders."

Mercury Interactive CEO and President Tony Zingale said the union means the two companies will "instantly become the industry's premier provider of business technology optimization software."

HP plans to pay $52 per share for Mercury Interactive, with the acquisition expected to increase the size of HP's software business to more than $2 billion a year in revenue. Once the deal closes, Mountain View, Calif.-based Mercury will become part of the HP software business, with both companies' sales forces cross-selling each others' products.

In a conference call with news media late Tuesday, Hurd said he expects the acquisition to help HP become a more powerful force in the software industry. "Software is core to the strategy of the entire company," he said. "When you have an opportunity to acquire a company like Mercury, you do it."