A number of sources have speculated that multinational computer technology company
Dell is to merge with computer data storage company EMC Corporation (EMC) later today (October 12, 2015). Dell, which has headquarters in Round Rock, Texas, United States, is a globally recognized brand that is involved in producing computer hardware and providing computer related services. EMC, which has headquarters in Hopkinton, Massachusetts, United States, was established in 1979. After the merger the resulting entity is likely to have a value of about $75 billion, making this the largest IT business deal ever.
According to a number of reports executives at the two companies had not been informed of merger discussions before rumours hit the headlines - discussions have only taken place between Michael Dell and Joe Tucci, Dell and EMC’s respective CEOs. Reports have also suggested that Dell will remain the majority stakeholder and the deal will include a cash payment valued at $27.25 per EMC share. With EMC’s VMware stake taken into consideration, this could reach more than $30 per share. Dell will generate cash through the sale of bonds.
Elliott Management, which is led by Paul Singer, a hedge fund manager who wields a lot of influence in the IT arena, is a major EMC shareholder and there has been some speculation as to whether the activist hedge fund investor will throw its support behind the deal. Elliott has been pushing for changes at EMC for over a year.
What are your thoughts? Will this deal go ahead? Add your comments below.
