Data storage company 3PAR Inc is setting itself up as an attractive takeover target for larger tech companies, according to a report in the Dec 28 edition of Barron's.

Data storage is a $14 billion-a-year business, and as demand grows, bigger data storage companies might eye 3PAR, the report said.

The Fremont, California-based company, which has cheaper, more advanced data storage technologies than its larger rivals, has landed major customers including Verizon Communications Inc , Credit Suisse and the U.S. Census Bureau and Department of Justice, and has grown its revenues and has gross margins of around 65 percent, according to the report.

An initial offer could be north of $15 (a share), putting a value of just under $1 billion on the company, Hapoalim Securities senior technology analyst Kevin Hunt told Barron's, saying that value could quickly rise to $20 a share or more.

Shares of 3PAR closed at $10.28 on Thursday. They have fallen 3 percent in the last six months as the Nasdaq has risen more than 25 percent on fears that sector heavyweights like EMC Corp , International Business Machines Corp and Hitachi might catch up on the technology front. But the company has $100 million in cash, little debt and some say earnings could as much as quadruple in the next year, then nearly double, again, the year after, Barron's wrote.

(Reporting by Clare Baldwin; Editing by Leslie Adler)