Behind the Deal: What Motivated EMC Sale?

Dell is proposing the largest merger in the technology industryEUs history. The private company has inked a $67 million agreement with EMC that would create an behemoth in several sectors of the tech market.

Immediately after the ink dries on the mega deal, the merged company will stand as a leader in the $2 trillion information technology market and tap into synergies in high-growth areas such as digital transformation, software-defined data center, hybrid cloud, converged infrastructure, mobile and security.

"The waves of change we now see in our industry are unprecedented and, to navigate this change, we must create a new company for a new era," EMC Chairman and CEO Joe Tucci [pictured] said in the announcement. "I truly believe that the combination of EMC and Dell will prove to be a winning combination for our customers, employees, partners and shareholders.EU

The HP Factor

The outcome remains to be seen but analysts seem to be bullish on the prospects. We caught up with Rob Enderle, principal analyst at the Enderle Group, to get his thoughts on the mega merger. He told us EMC needed to find a replacement for Joe Tucci and get out from under the pressure of "activist investors" to break the company up.

WhatEUs more, EMC needed a stronger server partner and some kind of client solution, he said. Dell brings all that to the table.

EUDell, with HP falling, has an opportunity to fully displace the company but needs to get bigger fast and needs a stronger enterprise channel, which EMC provides,EU Enderle said. EUWhile this really screws HP, which had cut it enterprise group sharply to make it a more attractive acquisition for either EMC or Oracle -- they'd prefer EMC because Mark Hurd would have a painful agenda with HP -- the merger fixes a number of...

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