Acquisition and Sale of Dell Assets

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2021

Complete the transfer of VMware assets to a separate company from Dell

On November 1, 2021, VMware officially separated from Dell. As part of the reorganization, the 81% share of the virtualization developer, which belonged to Dell, went into a separate company with a market capitalization of $64 billion. Dell's remaining assets (mainly related to equipment) have a value of about $33 billion, writes the Financial Times (FT), citing exchange data. More details here.

Sale of Boomi SaaS application integration service for $4 billion

In early May 2021, Dell announced an agreement to sell Boomi to investment companies Francisco Partners and TPG Capital for $4 billion. It is planned to close the deal before the end of 2021. More details here.

VMware Branch to New Company

On April 14, 2021, Dell Technologies announced the separation of VMware into a new company. Thanks to this restructuring, the IT corporation, founded by Michael Dell, will be able to earn $9.3-9.7 billion thanks to the payment of special dividends to VMware shareholders. By April 14, Dell owns an 81 percent stake in the US developer of virtualization tools. More details here.

2020: Sale of RSA Security for $2 billion

On February 18, 2020, it became known about the sale of RSA Security, which was previously owned by Dell Technologies, to the private investment fund STG Partners. First, The Wall Street Journal (WSJ) reported on the upcoming deal, citing informed sources, and then confirmation appeared on the official website of STG Partners. More details here.

2018: Investing in Graphics AI Processor Developer

In December 2018, it became known that the developer of processors for AI applications Graphcore attracted about $200 million in investments. According to the results of this round of financing, the company was valued at $1.5 billion. Large companies such as Microsoft, BMW, Dell and Samsung Electronics invested in Graphcore. More details here.

2016

Complete Dell-EMC Merger

On September 7, 2016, Dell completed its acquisition of EMC. This was preceded by the approval of the transaction from the Chinese antitrust authorities, which was the last necessary condition for its completion.

As a result of the merger, the world's largest private IT company was formed - Dell Technologies, represented by the family of businesses: Dell (end-user solutions), Dell EMC (infrastructure solutions), as well as Pivotal, RSA, SecureWorks, Virtuustream and Vmware, which will continue to operate as separate companies.

Dell cited a new group of companies:

• Total revenue of all divisions - $74 billion (fiscal year 2016 ended January 29, 2016)
• 140,000 employees
• Presence in 180 countries
• 25 production sites
• 40,000 people engaged in sales
• 30,000 employees employed in customer service and support
• More than 20,000 patents and patent applications
• $12.7 billion investment in research and development over the past 3 years
• About 50% of the company's sales are in the United States.

Sale of software business for $2 billion, including SonicWall and Quest Software

June 20, 2016 it became known about the sale of the software business. Dell Thus, the American corporation continued to sell assets and change its strategy, focusing on the absorption of the disk storage manufacturer, the EMC newspaper reports. The Wall Street Journal

The Dell Software Group, which develops and promotes software in analytics, database management, information protection, access control and performance monitoring, is being purchased by private investment firm Francisco Partners and hedge fund Elliott Management. The value of the transaction is not officially announced. According to Reuters, we are talking about more than $2 billion.

Software assets sold by Dell include, among others, subsidiaries Quest Software (a developer of enterprise IT management tools) and SonicWall (a provider of intelligent network security and data protection solutions), for which the corporation paid a total of $3.6 billion at the time.

Quest Software and SonicWall offer critical software to a huge and loyal base of over 180,000 customers. We see great opportunities in creating excellent technologies and a product portfolio, "said Dipanjan Deb, CEO of Francisco Partners.

According to Reuters, Dell decided to sell almost the entire software business, leaving only a cloud developer to integrate Boomi software tools.

Dell continues to fund the $67 billion EMC purchase deal. Earlier, Dell placed six bond issues in the amount of $20 billion, and also announced the sale of the IT services division for $3 billion and brought to the exchange a subsidiary of SecureWorks, specializing in information security solutions. This IPO allowed Dell to raise $112 million.^[1]

Dell-EMC Merger: Michael Dell Reveals What the Biggest Deal in IT History Will Lead To

After Dell completes the largest ever IT acquisition deal for EMC for $67 billion, a group of companies called Dell Technologies will be formed on the market. At the EMC World conference in May 2016, Dell founder and CEO Michael Dell spoke about this.

Dell's enterprise solutions focus will be integrated with EMC's IT solutions business through a new company called Dell EMC, which will be part of Dell Technologies. In addition to it, the family of companies will also include VMware, RSA and SecureWorks, Virtuustream, Pivotal and the company with the old name - Dell. The latter will focus on Dell's customer business (end-user solutions), including PCs.

Michael Dell noted that after the completion of the deal, Dell Technologies will become the world's largest provider of enterprise solutions, offering customers products for IT infrastructure, including PCs and servers, data center solutions, cloud solutions, etc.

The area where Dell and EMC come out with a noticeable product overlay is mid-tier storage - Dell has Compellent in this class, and EMC has a recently launched Unity line. Michael Dell said he plans to keep both lineups because Compellent is more focused on the initial level, while Unity is medium and higher. In other segments where EMC works, they do not intersect with Dell, he added.

According to Michael Dell, after the announcement of the deal, Dell and EMC conducted a survey among 7.5 thousand employees from both companies and found out that they have similar cultures: in several key areas, employees gave similar results, especially in terms of customer orientation.

The EMC acquisition transaction is expected to be completed in the second half of the year. It has received approval from all antitrust authorities where necessary, with the exception of regulators in China, from whom it is still expected.

Integration of Dell and EMC into one company should be completed by October 2016. By the time of the merger, each vendor has its own partner programs, but integration assumes that they will subsequently work through a single sales channel and have a common partner program. The head of Dell also noted that when Dell Technologies begins to operate in the market, the company will not focus on expanding the partner ecosystem, but, rather, will focus efforts on deepening relations with existing partners.

The current head of EMC, Joseph Tucci, who has led the company since 2001, said that this was the last time he was present at EMC World as the company's CEO. Dell and EMC will be led by Michael Dell.

Sale of Japanese NTT Data IT Services for $3.1 billion

March 28, 2016 it became known about the sale of part of the Dell IT-Business to NTT Data, owned by the Japanese telecommunications giant Nippon Telegraph & Telephone (NTT). Thus, numerous rumors were confirmed.

According to NTT Data, Dell is buying Dell Services for information technology services from Dell. The cost of the transaction will be $3.1 billion, the timing of its closure is not named.^[2]

Through this acquisition, NTT Data expects to strengthen its position North America in and expand cloud services and services. outsourcing business processes About 28,000 Dell employees will join the company, working mainly in and, USA India as well as all Dell data centers Services located in the USA Great Britain and Australia. As of the end of March 2016, NTT has about 230 data centers.

There are several acquisitions in our market that can provide such a unique opportunity to increase our competitive level and depth of our offers in the market, "comments NTT Data CEO John McCain. - Dell Services is a very good business, and we are confident that its staff and long-standing customer relations, as well as a combination of long-term and project work, will strengthen our portfolio of solutions.

Dell Services was created after the purchase of Perot Systems in 2009 for $3.9 billion. After Dell announced the purchase of the manufacturer storage systems EMC for $67 billion in the fall of 2015, rumors began to circulate in the press about the sale of Perot Systems-related assets and other non-core units in order to finance a large transaction.

In addition to NTT Data, Tata Consultancy Services (India), Cognizant Technology Solutions (USA) and Atos (France) were interested in buying Perot Systems.

2015: EMC Purchase Announcement for $67 Billion

October 12, 2015 Dell announced the purchase of the manufacturer storage systems EMC for $67 billion. This deal was the largest in the history of the IT industry.

Under the terms of the agreement, EMC shareholders will receive from Dell in cash $24.05 for each securities they own and special shares of VMware virtualization manufacturer (80% owned by EMC) in an approximate amount of $9.1 apiece. At the same time, VMware will remain an independent public company.

Thus, the entire transaction is valued at $33.15 per EMC share, which is 28% higher than the closing level of the exchange on October 7, 2015 - shortly before the first reports of companies preparing for the merger. After the official announcement, EMC quotes jumped 8%.

The combined company will be headed by Dell CEO Michael Dell, its headquarters will be located in Hopkinton (Massachusetts, USA). The deal is scheduled to close between May and October 2016.

"We continue to develop the company in the most important areas where IT is moving. This deal will only speed up this process, says Michael Dell. "Our company will take an extremely good position for growth in the strategic areas of the next generation of information technologies, such as the digital revolution, software-oriented data centers, converged infrastructure, hybrid clouds, mobile technologies and information security solutions."

The analyst of Forrester Research Glenn O'Donnell considers that Dell, having rather weak positions in the market of disk storages, due to purchase of EMC will expand a portfolio of offers to the level which will be enough for successful competition with HP, Cisco, IBM and Huawei.

The merger between Dell and EMC has been the biggest in IT industry history. Previously, such a deal was considered the purchase of the Broadcom chipmaker by the semiconductor company Avago Technologies for $36.5 billion.^[3]

2013

Michael Dell buys back Dell for $24.9 billion

Dell reported in September 2013 that a committee of its board of directors accepted the offer of founder Michael Dell to buy back shares from minority shareholders at $13.88. The day before, at a special meeting, its shareholders voted and approved the sale of the company to its founder, chairman of the board and CEO Michael Dell and the investment company Silver Lake Partners.

As part of the agreements reached, Dell shareholders will receive $13.75 in cash for each ordinary share of the company they own, as well as $0.13 special dividends per share. Thus, shareholders will receive $13.88 for each security, which is $0.23 more compared to the initial offer.

The value of Dell shares as of September 2013 is $13.85 apiece. After the deal was announced in February 2013, the stock rose about 27%.

The transaction amount is about $24.9 billion (compared to the originally planned $24.4 billion). The transaction is scheduled to close before the end of Q3 2013-2014 of Dell (Q3 will end in October 2013), following all standard procedures, including regulatory approval. Dell will remain headquartered in Round Rock, Texas.

In October 2013, the American company Dell left the exchange of high-tech companies NASDAQ and becomes private. Under the terms of the buyout agreement, which was supported by a special committee of the company's board of directors, minority shareholders will receive $13.88 in cash per share. The amount consists of the actual repurchase price - $13.75 and a guaranteed dividend of $0.13. The total amount to be spent on redemption is $24.9 billion.

Dell sold to private foundations

Dell is negotiating the sale of its shares to private investment funds, Bloomberg reported in early 2013, citing informed sources. After the news was released, Dell shares rose 13% to $12.29 apiece on Monday, January 14, 2013. Among the funds under negotiation, one source mentioned TPG Capital and Silver Lake. Another source said that the deal could be officially announced as early as this week. Some large banks are also involved in the negotiations.^[4]

Leaving the exchange can help Dell, which has a market value of about $19 billion, increase growth and more effectively fight for the market with competitors, avoiding pressure from shareholders who are chasing profit. To satisfy investors, Dell CEO Michael Dell has chosen takeover tactics to expand the enterprise product portfolio by eliminating tablets and smartphones.

Dell reached an agreement in February 2013 with private investment firm Silver Lake Partners and other funding parties and was privatized through a leveraged buyback of $13.65 per share, totaling $24.4 billion. Michael Dell will continue to lead the company after its leveraged buyout, in which Silver Lake, MSD Capital cash is invested, a $2 billion loan from Microsoft and additional funding from BofA Merrill Lynch, Barclays, Credit Suisse and RBC Capital Markets. Michael Dell will invest his own shares in the deal - this is expected to be about 16% of the total number of shares - and will contribute a "substantial additional amount in cash," the company said.

The idea of ​ ​ privatization was first proposed to the Dell Board of Directors by Michael Dell himself in August 2012, the company said. The Special Committee conducted an independent analysis, including a review of strategic options for remaining open.

Dell shares closed in trading on Monday at $13.27 in anticipation of a buyback. The share price rose significantly after the first report of a possible buyback of the company. (As of December 31, 2012, the closing price was $10.14 per share. During 2012, Dell shares were among the least profitable in the IT industry; last year, their value fell by more than 30%.)

Hewlett-Packard criticized the Dell privatization deal, saying that a "significant debt burden" will not allow it to fully "invest in new products and services."

"Dell has a very difficult road ahead," HP wrote in an unsigned statement addressed to the press. - The company has a long period of uncertainty and transformation ahead, which can hardly be considered as a good for its customers. With heavy debt burdens, Dell's ability to invest in new products and services will be extremely limited. We are confident that Dell customers will now want to consider alternatives, and HP plans to take full advantage of this opportunity. "

2012

Acquisition of Wyse Technology

On April 2, 2012, Dell announced the acquisition of Wyse Technology, a company that was at the root of thin customer creation. Recently, it has shifted focus from hardware to software: the third largest PC manufacturer in the world expects to supplement its portfolio with solutions for virtualization of desktops and taking client places to the cloud.

According to Dave Johnson, Dell's Senior Vice President of Enterprise Strategy, the acquisition will allow for closer integration of desktop virtualization solutions with data centers, network infrastructure, and storage. Jeff Clark, president of end-user solutions, said that desktop virtualization can simplify IT management tasks for organizations, increase workplace security and cost-effectiveness. "Employees will have a chance to increase their own productivity, because they will be able to work whenever, anywhere and in whatever way is most convenient for them."

Wyse's product offering includes zero clients, thin and cloud PCs, desktop virtualization software, cloud applications, and management tools. They support a wide range of platforms from desktops and laptops to mobile devices, including smartphones and tablets. The company has been operating on the market for 31 years, during which time it has delivered over 20 million units around the world. Its closest competitors are Microsoft, VMware, Citrix and a number of smaller vendors and startups.

At a press conference on the details of the transaction, Wyse representatives emphasized the importance of the PocketCloud technology presented back in 2009. It allowed owners, Apple iPhone iPad iPod Touch, of OS-based mobile devices Google to access enterprise PC desktops. The application of the same name is available through Apple and. App Store Android Market

Acquisition of Quest Software

On July 2, 2012, Dell announced the signing of a binding agreement to purchase Quest Software by paying $28 per share in cash. The transaction amount will be $2.4 billion. The deal has already received approval from the boards of directors of both participants. It is scheduled to close in Q3 2012 following standard procedures, including approval of Quest shareholders.

Several buyers were interested in acquiring Quest Software. In early March, the company announced that it had accepted an offer from the private investment fund Insight Venture Partners in the amount of $2 billion or $23 per share. However, Quest said last week that it received a better offer of $2.32 billion or $27.5 per share from a certain buyer, whose name declined to be reported. Unofficial sources said that this buyer is Dell.

The refusal to sell the Insight investment fund, with which Quest managed to sign a binding agreement, will cost Quest $37 million in compensation, including a $25 million fine and $12 million in compensation for expenses incurred, Reuters reports.

At the time of sale, Quest specializes in developing software for data management, data protection, performance optimization, workplace management, management of Windows server applications (Exchange, Lotus Notes, Office 365, SharePoint, etc.) and account management and access control software.

According to the official announcement, Quest technologies and solutions will be part of the portfolio of the newly formed Dell Software Group and will help Dell expand the portfolio of solutions designed for enterprise customers. The purchase of Quest is one of Dell's many recent acquisitions. Dell's goal is to strengthen the portfolio of intellectual property, solutions, and technologies that help deliver end-to-end, end-to-end solutions.

Dell's recent acquisitions in addition to Wyse Technology (a provider of client cloud solutions) also included SonicWall (network security and data protection), SecureWorks (a provider of security-as-a-service solutions), etc.

At the time of the transaction, Quest employs about 1.5 thousand sales specialists and about 1.3 thousand developers. Quest's customer base includes more than 100,000 companies from various countries around the world, including 87% of Fortune 500 companies^[5].

Quest's revenue for the last fiscal year delivered $857 million. For comparison, Dell's software business has an annual turnover of about $1.2 billion.

Gale Technologies takeover

On November 16, 2012, Dell announced the purchase of infrastructure automation software developer Gale Technologies.

Financial details are not provided. The purchased company will enter the converged systems division. The staff is not planned to be reduced.

The new solution can become a solid competitor to the Oracle Exata family of products that have been shipped worldwide since the end of 2010.

2011: RNA Networks takeover

In June 2011, the company acquired RNA Networks, a developer of server and RAM combining virtualization technology.

2010

Defeat in the battle for 3Par

On August 16, 2010, Dell announced it had signed a $1.15 billion agreement to purchase a 3Par storage provider. The company offered $18 for each ordinary share of 3Par, which is 87% higher than the value of securities as of the close of the exchange on August 13.

After that, HP entered the auction, raising the bar to $24 or $1.6 billion. Then the companies raised rates several times. Dell last offered $32 for each 3Par share. Yesterday, September 2, the company announced that it did not intend to raise the rate anymore.

On September 3, 2010, Hewlett-Packard announced that it had signed a final agreement to purchase 3Par, a California storage vendor, for $2.35 billion or $33 per share in cash. 3Par cancelled an earlier agreement with Dell, which made the purchase offer first. In accordance with one of the clauses of the contract, 3Par paid Dell a penalty of $72 million for refusing the transaction.

Takeover of Ocarina Networks

In late July 2010, Dell announced the acquisition of Ocarina Networks, a storage optimization technology development and implementation company.

2009: Purchase for $3.9 billion of IT service provider Perot Systems

At the end of 2009, Dell retained the position of the second largest personal computer manufacturer in the world, although in the first quarters of 2010 it lost to Taiwanese Acer. Dell's revenue at the end of 2009 was $53 billion, more than 2 times less than the annual revenue of Hewlett-Packard. The lion's share of Dell's revenue is formed by PC sales, while they form only a third of HP's total revenue. According to analysts, Dell's storage solution business in 2009 generated about $2.2 billion in revenue.

• On September 20, 2009, Dell entered into an agreement to acquire Perot Systems for approximately $3.9 billion. The deal is scheduled to be completed between November 2009 and January 2010. Under the terms of the agreement, Dell will purchase ordinary shares from Perot Systems at a price of $30 apiece, which is 68% higher than their price at the time of completion of trading on September 18, 2009.

Perot Systems, a provider of IT services and solutions, was founded in 1988 by Henry Ross Perot, who ran for president twice in the 90s. USA Perot Systems revenue in 2008 amounted to $2.8 billion. The company helps enterprises build, IT Infrastructure implement software, optimize, business processes provide IT services, 24-hour technical support, and provide virtualization and cloud computing services.

With the acquisition of Perot Systems, Dell expects to provide a wider range of IT services and solutions, expand the existing Perot Systems network worldwide, increase the efficiency of both companies in this area, and, through the Perot customer base, get new customers to supply their computers. The total revenue of Dell and Perot Systems over the past four quarters amounted to $16 billion, half of which brought services and customer support.

As part of the agreement, Perot Systems will be transformed into a Dell division with its head office in Plano, Texas - where Perot Systems is currently headquartered. The division will be headed by Peter Altabef, the current executive director of Perot Systems. At the same time, Henry Ross Perot Jr., the son of the founder of the corporation of the same name and the current chairman of the board of directors of Perot Systems, will be admitted to the board of directors of Dell.

2007: $1.4 Billion Acquisition by Storage Provider EqualLogic

For $1.4 billion, Dell absorbed a player in the storage market - EqualLogic.

Notes