For Dell, It's About Size As It Shells Out $67 For On EMC, HP Enterprise CEO Slam Deal

ZDNet | Technology

For technology firms, its all about gobbling one another. Google acquiring DeepMind £400 million, Facebook acquired WhatsApp for $19 billion, Oculus for $2billion and Instagram for $1billion. HP acquired Compag $18.6 billion and Autonomy £11billion. The list just goes on.

* Michael Dell is the founder and CEO of Dell Computers.

The latest ground-breaking acquisition is by Dell which announced it was acquiring EMC for $67 billion, in a deal that potentially creates the largest privately held technology company. The acquisition will be in cash and stock.

In a report Monday, Technology website ZDNet said the new company will be managed by Dell Computers founder, Michael Dell.

EMC is an American company that offers data storage, information security, virtualization and analytics.

It is also a leader in cloud computing as well as offering products and services that enable businesses to store, manage, protect, and analyze data.

Dell is particularly interested in EMC because it targets large companies, but small and medium sized businesses across various vertical markets are also not ignored.

It has, however, not gone all well with every technology company CEO. Meg Whitman, Enterprise CEO of HP has spoken out against the deal, saying in an email to “All Hewlett Packard Enterprise Employees” that the merger is “a good thing for Hewlett Packard Enterprise and an opportunity for us to seize the moment.”

She said HP Enterprise is “two years ahead of the game” and that Dell is emulating HP's strategy.

Whitman noted that “To pay back the interest on the $50 billion of debt that the new combined company will have on their balance sheet, Dell will need to pay roughly $2.5 billion a year in interest alone."

"That's $2.5 billion that they will allocate away from R&D and other business critical activities, which will keep them from better serving their customers.”

She then told them that “All of this at the very moment when we have completed our journey to create two new, focused companies," adding "We're organized, we have a strong balance sheet and our innovation engine is humming. So, get out in front of your customers and your partners. Tell them our story. Take advantage of this moment.”

Dell has not reacted to her statement.

Read the full article at www.zdnet.com.