Dell mulling biggest tech takeover as it sets its crosshairs on EMC

Posted on Thursday, Oct 08 2015 @ 13:33 CEST by Thomas De Maesschalck
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Dell and private-equity firm Silver Lake are reportedly in talks to acquire the storage business of EMC. The latter currently has a market cap of close to $50 billion and WSJ reports this deal would be the biggest takeover ever in the technology industry. The move fits inside Dell's view to become focused on technology for big companies, a move away from its more consumer-oriented past.

People familiar with the matter told WSJ that a deal could be reached within a week. Dell is primarily interested in EMC's market-leading data storage business, the journal received word that one of the focus points of a potential acquisition would be to spin off EMC's stake in VMware. EMC has a 80 percent stake in VMware, which has a market cap of just over $34 billion.
EMC has been under pressure to boost its stock price since last year, when activist hedge fund Elliott Management Corp. took a roughly 2% stake in the company and urged it to spin off VMware. EMC owns 80% of VMware, which has a market value of $34 billion. An arrangement struck in January between Elliott and Hopkinton, Mass.-based EMC that had barred the fund from publicly pressuring EMC expired last month. Elliott has since stayed quiet.

About the Author

Thomas De Maesschalck

Thomas has been messing with computer since early childhood and firmly believes the Internet is the best thing since sliced bread. Enjoys playing with new tech, is fascinated by science, and passionate about financial markets. When not behind a computer, he can be found with running shoes on or lifting heavy weights in the weight room.

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