Dell's massive $67 billion acquisition of EMC officially closed today. The deal was first announced last October and resulted in the PC manufacturer being renamed Dell Technologies. The name change reflects the multiple new technology related businesses Dell will now be a part of in addition to making PCs. EMC, after all, was a giant in its own right with a variety of businesses in networking, storage, cloud computing, and IT management.
In a detailed write up by TechCrunch, Ron Miller explains EMC's complicated organizational structure. Miller writes, "Unlike most big corporations with internal divisions operating under a single corporate structure with a single stock, EMC is a federation of affiliated and sometimes independent companies." One of the most important components of that federation is EMC's (and now Dell Technologies') 80% stake in VMware, the cloud and virtualization technology company.
Being able to sell solutions for cloud computing, hybrid clouds, and IT management will give the traditional PC maker new opportunities for growth. It's no secret PC sales have been struggling for some time. And while Dell's exceptional performance as a PC manufacturer helped create the PC market, times - and markets - change.
Nearly a year later
The deal took a year to close because of its record-setting size. Regulators across the globe took a look at the merger. And finally last week the deal passed the last set of regulatory checks in China. In Miller's piece, he does a roundup of heavyweights' opinions on the merger, and they are mostly positive.
Oracle chairman Larry Ellison even went so far as to say the $67 billion price tag was a bargain and Dell shareholders stand to make a considerable amount of money. In a conference call with investors, Michael Dell said today "We don't have to cater to short term thinking. We can think in decades. We will be the trusted provider for infrastructure for the next industrial revolution."
The merger will certainly give Dell some exciting opportunities for growth, but time will tell. Merging two companies processes and culture is never simple. And that difficulty is likely only amplified by the size of the deal and the complexity of EMC's business.