In what many are calling a historic milestone in the tech industry, Dell has completed its acquisition of EMC for $67 billion. CBR looks at the result of the merger – the new tech giant dubbed Dell Technologies.
Introducing Dell Technologies
The merger of Dell and EMC has created the world’s largest privately-controlled tech company, rebranded as Dell Technologies.
The coming together of storage giant EMC and well-known computer maker Dell has seen the creation of a $74bn company, a company which now boasts an expansive portfolio spanning computers to hybrid cloud, converged infrastructure and software-defined data centre.
The road to Dell Technologies started in October 2015 with Dell announcing its intention to buy EMC, an acquisition billed as the biggest tech buyout in history. The announcement came two years after Dell returned to private ownership, with the proceeding acquisition dogged with rumours that Dell was struggling to finance the acquisition. Losses from the Perot Systems deal combined with other factors like the downturn in tech stocks added fuel to these financing rumours.
However, the $67bn deal was finally completed on September 7 2016, with Michael Dell, chairman and CEO of Dell Technologies, saying, "We are at the dawn of the next industrial revolution. Our world is becoming more intelligent and more connected by the minute, and ultimately will become intertwined with a vast Internet of Things, paving the way for our customers to do incredible things.
"This is why we created Dell Technologies. We have the products, services, talent and global scale to be a catalyst for change and guide customers, large and small, on their digital journey."
One Big Tech Family
Dell Technologies comprises a family of business, including Dell, Dell EMC, Pivotal, RSA, SecureWorks, Virtustream and VMware.
Serving 98% of the Fortune 500, the best-known businesses under the Dell Technologies umbrella are the Dell client solutions business and the Dell EMC infrastructure solutions business – both of which are supported by Dell EMC Services. Dell EMC is the new name of the unit serving the enterprise side of the business, with Michael Dell saying that "Dell and EMC is a major cloud infrastructure company…no one is more relevant or more able to bring value to your data centres," when announcing the new mega tech company at EMC World 2016.
These two businesses, when combined with the other family members under Dell Technologies create quite a unique corporate structure. The unique corporate structure, according to the company, will give the focus and innovation of a startup with the global scale and service of a large enterprise.
Serving both David and Goliath
Dell Technologies is looking to grab both ends of the $2 trillion information technology market, claiming the new company blends Dell’s go-to-market strength with small business and mid-market customers and EMC’s strength with large enterprises.
Dell Technologies has said that it’s scale will enable the delivery of more innovation and investment in R&D, sales and marketing, services and support and deliver more efficient and cost-effective solutions for customers.
Private But Public
Dell Technologies is a privately controlled company, yet the tech giant has stated that it will report its financial results publically. Being privately controlled, the company claim, will enable it to better focus investments on its customer and partner ecosystem over the long term.
VMware, a subsidiary of EMC, will remain publically-traded after going through a shake-up thanks to the acquisition. 800 jobs were axed at the cloud and virtualization software provider, with other troubles including a failed joint Virtustream cloud agreement.
Meanwhile SecureWorks, a subsidiary of Dell, will also remain publically-traded, although its recent IPO disappointed with the company decreasing share price and the number of shares marketed.