EMC May Be on Merger Block — Who’s Buying?

Is EMC selling itself? The data storage products maker might be, if you believe the rumor mill. The Wall Street Journal first broke the story about a potential merger and other options, citing pressure from a shareholder activist and the retirement of its CEO Joseph Tucci sometime early in 2015.

In fact, the Journal reports that EMC has been in talks with Hewlett-Packard (HP) for nearly a year about a potential tie up. Those talks recently ended, but discussions are reportedly underway with Dell, Cisco and Oracle, the paper reported. ItEUs unclear if EMC would be sold as an entire unit or broken up into parts and lose its brand identity altogether.

None of the companies mentioned in the Journal article were immediately available for comment, but itEUs easy to see how the sale of individual parts of the company could be an option. EMC is known for storage but it also offers data protection, cloud, big data, security, content management and infrastructure management. The company has platforms for VMware, Microsoft, Oracle, SAP, VSPEX and mainframe.

Commoditized Market

We caught up with Zeus Kerravala, principal analyst at ZK Research, to get his thoughts on the rumors. He told us heEUs heard the same chatter and he thinks a merger makes sense for EMC at this stage of its lifecycle -- and at this stage of the market. EMC owns about 20 percent of the storage market.

EUEMC largely is a storage company,EU Kerravala said. EUFrankly most of what they do is storage today so itEUs harder and harder to compete. I think it would make more sense to be part of a larger company like HP or Dell.EU

As he sees it, EMC would be an interesting purchase because although part of the business is commodity storage, majority ownership of VMware is also at stake...

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