“The transaction combines two of the world’s greatest technology franchises with leadership positions in servers, storage, virtualization and PCs and it brings together strong capabilities in the fastest growing areas of the industry, including digital transformation, software-defined data center, hybrid cloud, converged infrastructure, mobile and security”, Dell said. The site also suggests that the deal may include a clause allowing EMC to identify other, higher offers – though it’s unclear who would be willing to stump up more than $68 billion.
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THE world’s biggest ever technology deal is set to go ahead after Dell confirmed it would swallow up EMC for around $67bn (£44bn).
The company also comments, “The combination of Dell and EMC creates an enterprise solutions powerhouse”, in a prepared statement.
Computer maker Dell Inc said on Monday that it had agreed to buy data storage company EMC Corp in a $67 billion record technology deal that will unite two mature companies and create an enterprise tech powerhouse.
EMC’s board has approved the merger and will recommend that shareholders do so as well. VMware will remain a public, independent company following the sale, Dell said.
Simpson Thacher & Bartlett LLP is advising Dell and Silver Lake, while Wachtell Lipton Rosen & Katz partners Steven A. Rosenblum and Gordon S. Moodie represent Michael Dell and his investment firm, MSD Partners.
Glenn O’Donnell of Forrester Research said Dell might have to sell a few of its VMware shares to finance the EMC acquisition, but that would simply mean ownership of VMware would be more widely distributed.
“The transaction will unite Dell’s strength with small business and mid-market customers with EMC’s strength with large enterprises to fuel profitable growth and generate significant cash flows”.
“It’s a nightmare situation for VMware shareholders”, Daniel Ives, an analyst at FBR Capital Markets, told Investor’s Business Daily.
Michael Dell, with the help of Silver Lake, took the PC maker private in $25 billion deal two years ago.
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Although the president and CEO Joe Tucci batted that one away and said its Masshecusets operation would continue to play a vital role it shows the unease around the idea that a major local employer is no longer in control of its own destiny.
