skip to main content

Dell in talks to buy data storage company EMC - source

Dell ranked third in global PC shipments in the second quarter
Dell ranked third in global PC shipments in the second quarter

Dell, the world's third largest personal computer maker, is in talks to buy data storage company EMC, a person familiar with the matter said, in what could be one of the biggest technology deals ever.

Dell is also talking to banks to finance an all-cash offer for the Massachusetts-based company, the person told Reuters. 

The terms of the negotiations were not immediately known. EMC has a market capitalisation of about $50 billion as of yesterday's close. 

A potential deal could further strengthen Dell's presence among corporate clients at a time when Michael Dell has been trying to transform the company he founded in 1984 into a complete provider of enterprise computing services such as Hewlett-Packard and IBM. 
 

The news of the deal talks comes two years after Dell was taken private for $24.9 billion by founder Michael Dell and private equity firm Silver Lake, ending Dell's decades-long run as one of the world's largest publicly traded PC makers. 

If the deal goes through, it will top Avago Technologies' $37 billion offer for Broadcom. 

EMC has been struggling under pressure from activist investor and shareholder Elliott Management Corp, which wants the company to spin off its majority-owned VMware unit. 

Reuters reported last week that Elliott Management plans to give EMC most of October to respond to its demands after a standstill agreement expired. 

Even though EMC has made clear it will not entertain a major split, Elliott hopes the additional time will give the company more room to craft a response that could avoid a bruising activist campaign. 

Dell ranked third in global PC shipments in the second quarter after Lenovo Group and HP, according to research firm International Data Corp.