Dell is paying a huge amount for an acquisition that will make it a major player in the business arena.
Dell recently announced an agreement to purchase a provider of data storage products for businesses, EMC, for $67 billion. The board of directors of EMC has already approved the agreement and is planning to advise its stockholders to do the same.
The acquisition would expand the reach of Dell well beyond PCs and consumer devices into the business market, where it’s been focusing more attention in recent years.
This move is critical as consumer PC sales continue to remain weak. The deal comes at a time when other tech players are trying to shrink, such as Hewlett-Packard’s split into two separate companies, one focused on its PC and printing business, the other on the enterprise services.
According to market researcher International Data Corp, Dell was No. 3 in the PC market worldwide in the third quarter of 2015 with a 13.1 percent share, behind HP and Lenovo.
The merger would make Dell one of the largest providers of technology products for big business customers by bringing together Dell’s experience selling products and services to small and midsize businesses with EMC’s expertise with large enterprises.