After a year-long journey, Dell Inc. is now acquiring EMC Corp. for a record-breaking deal worth $67 billion. The acquisition, which is considered the largest and most ambitious tech deal, aims to transform the PC-maker giant as a data storage and security enterprise player amid the ever-changing tech landscape.
Prior to the Dell-EMC deal announcement on Monday, EMC's longtime chairman and chief executive Joseph M. Tucci and Dell co-owner Michael S. Dell and JPMorgan Chase's top banker Jamie Dimon made some 50 confidential meetings to make this deal into fruition. According to The New York Times, the road to Project Emerald, the name of the deal internally, started last fall with Dell with the codename Diamond and its partner Silver Lake was known as Spartan.
The negotiations between Dell and EMC have been pretty exhaustive with issues arising like if Dell could afford the purchase. Though many of the details remained subject to negotiation, discussions have narrowed to the finer points within the last two weeks.
After announcing the acquisition Monday afternoon, Mr. Dell and Mr. Tucci flew to San Francisco to attend a dinner that Silver Lake's managing partner Egon Durban was hosting at his Silicon Valley home on behalf of Temasek, a Singaporean sovereign wealth fund that was co-investing in the EMC deal.
Meanwhile, the Dell-EMC deal, which is this year's third-largest in all sectors, will diversify Dell from a stagnant consumer PC industry and give it greater scale in the more profitable and fast-growing market for cloud-based data services, Reuters noted.
Through the collaboration of Dell's server business and EMC's storage and virtualization assets, the new company will have a comprehensive range of products to compete with Cisco Systems Inc, IBM and Hewlett-Packard in the areas of cloud computing, mobility and cyber security.
Meanwhile, the Dell-EMC deal is expected to close between May and October 2016. USA Today reported the merger will concentrate on paying debt during the 18 to 24 months after the closing. Dell will also lead the company as chairman and CEO while Tucci will remain EMC's veteran CEO and chairman until closing.
The company officials also added that there are no immediate plans for layoffs related to the Dell-EMC transaction.
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