$67 billion merger completed

Dell and EMC heading ‘to where IT is moving’

Michael Dell (contributed)
Michael Dell (contributed)

The largest technology merger in history will prepare Dell and EMC Corporation for the next generation of growth in the sector, according to Michael Dell.

The $67 billion acquisition creates Dell Technologies and also represents the largest privately-owned technology company on the planet.

Mr Dell told a global analysts’ and media conference call this afternoon the deal takes the new combined company into “the most relevant areas where IT is moving.”

Dell, headquartered in Round Rock, Texas, has in recent years attempted to offset declining demand and a narrowing of profit margins involving a range of desktop computers. In the process he delisted the company he founded 30 years ago.

Dell approached EMC, based in Hopkinton, Massachusetts, last year with the merger proposal coming to light last October. EMC has been described as the best kept secret in tech.

It delivers secure enterprise cloud-based data storage and analytic solutions to the marketplace. The new combined business will serve 98% of Fortune 500 companies, but also target mid-sized businesses.

Dell said they have now satisfied all required regulatory closing conditions and Dell Technologies begins operating immediately. Dell has agreed to pay EMC shareholders $24.05 a share plus 0.111 shares of trading stock related to EMC’s flagship VMWare. EMC shareholders agreed this in July.

Michael Dell claimed Dell Technologies will be exceptionally well positioned for growth in the most strategic areas of next

Dell EMC
Our story on EMC talks last October

generation IT, including digital transformation, software defined data centre, converged infrastructure, hybrid cloud, mobile and security.

“We are at the dawn of the next industrial revolution. Our world is becoming more intelligent and more connected by the minute, and ultimately will become intertwined with a vast Internet of Things.”

He added this paves the way for Dell Technology customers to do “incredible things” claiming: “With Dell Technologies we have the products, services, talent and global scale to be a catalyst for change and guide customers, large and small on their digital journey.

“Our family of businesses – Dell, Dell EMC, Pivotal, RSA, Boomi, SecureWorks, Virtustream and VMWare – provides essential infrastructure for organisations to build their digital future, transform IT and protect their most important assets: information.

“Our investments in R&D and innovation along with our 140,000 team members around the world will give us unmatched scale, strength and flexibility, deepening our relationships with customers of all sizes.”

The merger could carry a sting in its tail, according to Roger Kay, founder of independent market intelligence outfit Endpoint Technologies.

He told the Austin Business Journal that it could lead to as many as 2,000 layoffs globally although such a move would be done gradually.

“I see it as kind of inevitable that there will be a downsizing. It is pretty clear there will be some adjustments in headcount during the next year,” he warned.

Both Dell and EMC have a presence in Scotland. Dell has operated its sales and customer support centre out of City Park, Glasgow, since 2005, and EMC has a Livingston base it opened in 1999.

UPDATE: Hewlett Packard will spin off and merge its non-core software assets with the Berkshire-based Micro Focus International in a deal worth $8.8 billion (£6.6bn).

The move is part of Hewlett Packard chief executive Meg Whitman’s plans to focus strategy on a few key areas such as networking, storage and technology services.

The deal makes Micro Focus one of the UK’s biggest tech companies, with total annual revenues of $4.5bn (£3.4bn).

Micro Focus was promoted to the FTSE 100 last week, replacing ARM after it was bought by Japan’s Softbank.

Shares in Micro Focus jumped 21% in early trading, putting it top of the risers in the FTSE 100 index.

Leave a Reply

Your email address will not be published. Required fields are marked as *

This site uses Akismet to reduce spam. Learn how your comment data is processed.