With the PC market becoming an increasingly unreliable source of income, Dell is being forced to expand its offerings in other areas in order to remain profitable, such as cloud-based services for corporations. Managing and storing enterprise data is actually very lucrative at the moment, so much so that tech giants like Amazon and Google are fighting for control, which means Dell has a lot of competition. That’s why the company is reportedly discussing a potential merger with EMC, which already one of the biggest players in the market. Considering how EMC is worth $52 billion, this merger could end up being largest tech deal in history, and would give Dell the power it needs to take on the likes of Amazon and Google.
Dell is discussing with banks a merger in conjunction with EMC Corp. This news, Reuters reports, comes by way of “sources familiar with the matter,” who say that the number-three PC maker is trying to enhance its cloud presence in an effort to compete with enterprise-focused computer companies like HP and IBM. If it were to actually come to fruition, the acquisition would be the most significant tech deal in history, considering EMC is worth $52 billion. It would also be a way for Dell to gain some traction in an increasingly dormant PC market. “Dell and EMC are increasingly competing with the likes of Amazon, Google, Microsoft, and others that have deep pockets. Becoming larger would make Dell and EMC of greater strategic importance to their customers,” Jefferies tech analysts expressed in a note to their clients. “Secondly, a combination would allow Dell and EMC to provide a more complete private cloud stack.” Approaching the alleged deal, EMC’s shares have risen 4.3 percent to $27.07 on the New York Stock Exchange. VMware, EMC’s majority parent company, however, saw its share drop 6.2 percent. For the deal to go through, analysts have suggested that an offer of at least $30 per share would be needed from Dell. That would make the total price of the company a whopping $58 billion. Reuters’ sources say that it’s too early to start talking about price, however.
