You are here

Update: Dell to buy EMC in US$67b deal

mhDELL121015.jpg
Dell Inc will buy data storage company EMC Corp in a deal valued at about US$67 billion, the largest on record in the technology sector.

[NEW YORK] Dell Inc will buy data storage company EMC Corp in a deal valued at about US$67 billion, the largest on record in the technology sector.

The offer is US$33.15 per share in cash and special stock, the companies said in a joint statement on Monday.

EMC shares were up 3.9 per cent at US$29.08 in premarket trading.

The deal will help the world's No.3 PC maker tap into the faster-growing and lucrative market for managing and storing data for businesses amid waning demand for personal computers globally.

Dell said it would pay US$24.05 per share in cash and the rest in a special stock that tracks the value of a portion of EMC's economic interest in VMware Inc, the virtualization software company majority-owned by EMC.

"The combination of Dell and EMC creates an enterprise solutions powerhouse," said Michael Dell, who will lead the combined company as chairman and chief executive.

EMC is also planning to seek out other suitors, people familiar with the matter told Reuters on Sunday.

EMC's board has approved the merger agreement and intends to recommend that the company's stockholders approve the deal.

The deal will be financed through a combination of new equity from Michael Dell, MSD Partners, Silver Lake and Singapore state-owned investor Temasek Holdings as well as the issuance of the tracking stock, new debt and cash on hand.

VMware will remain an independent, publicly traded company. VMware shares were unchanged at US$78.65.

REUTERS