Mercury was delisted from the NASDAQ in January. It's CEO and CFO resigned late last year after an internal investigation into option granting practices.
Rumor has it that Oracle has also expressed interest in acquiring Mercury.
The deal, which sent shares of the No. 2 personal computer maker down 4 percent, should help boost sales of HP's OpenView systems management software, which makes it easier for far-flung businesses to monitor the hardware, software and networks running throughout their organizations.
The purchase of the former star Israeli technology company also puts HP in closer competition with other major systems management software providers, including IBM's (IBM.N: Quote, Profile, Research) Tivoli unit, CA Inc.'s (CA.N: Quote, Profile, Research) UniCenter and BMC Software (BMC.N: Quote, Profile, Research).