Other than VMware, EMC provides products and services in categories like information storage, archiving, backup & recovery, storage and content management, enterprise content management, security, cloud computing and data computing, all of which will now be Dell products.
Advertisement
EMC shareholders will receive about $33.15 per share, putting the total transaction value at approximately US$67 billion.
The deal is surprising since EMC has a market cap of $54.3 billion, while Dell’s is half that: $25 billion.
Privately held computer technology corporation, Dell, has acquired EMC for $67 billion in what tech and financial press are calling the largest pure-play tech acquisition ever.
Revere’s Roger Marino told the Boston Herald the deal is the “end of an era” for the Bay State, and he voiced concerns about the future EMC’s 9,700 employees.
While IBM, Cisco, Oracle, and Hewlett-Packard could potentially be suitors for EMC, the chances of them challenging Dell with a rival offer are slim. Dell will finance the deal to buy the company, which is about twice its size, with backing from MSD Partners, controlled by Michael S. Dell, Dell’s CEO, and Silver Lake, a major investor in Dell. So it makes sense that Dell engaged multiple streams of financing to fund the acquisition. However, not all are convinced of the deal’s capacity to reinvigorate either company.
EMC will also pay an additional US$2.5 billion if it enters into a deal with another company within 12 months of terminating the deal with Dell.
Advertisement
“The combination of Dell and EMC creates an enterprise solutions powerhouse, bringing our customers industry leading innovation across their entire technology environment”, Mr. Dell said in a statement Monday morning. Till now, VMware was a separate, publicly trading company under EMC on the New York Stock Exchange (NYSE). It added security by buying RSA and then agile development and a cloud platform with Pivotal. The deal is expected to close between May and October 2016.
