Dell sells $2bn software arm ahead of EMC mega-merger
Published 21/06/2016 | 02:30
Dell has agreed to sell its software unit to buyout firm Francisco Partners Management and the private equity arm of activist investor Elliott Management Corp.
The sale of the unit, which is focused on advanced analytics, database management and data protection, will help Dell reduce its debt burden after a series of deals since its own buyout in 2013. Terms weren't provided in the statement released yesterday.
The software unit is understood to include Quest Software, which employs 180 at Mahon Point in Cork.
Dell's chief executive officer and founder Michael Dell agreed in October to buy EMC Corp for $67bn to broaden the company's product line-up from servers to storage devices amid intensifying competition. Dell, which has said it will add about $50bn in debt to get the EMC deal done, expects the purchase to close between June and October, people familiar with the matter have said.
Sale of the software group is Dell's latest ahead of the EMC merger. Japan's NTT Data Corp agreed to buy Dell's information-technology services businesses for $3.06bn in March. A month later, Dell took its cybersecurity company SecureWorks Corp public, raising $112m.
Debt financing for the latest transaction was provided by Credit Suisse Group and RBC Capital Markets, according to the statement.
Texas-based Dell is also proceeding with selling software assets Sonicwall and Quest, people with knowledge of the matter have said. EMC is seeking to sell its Documentum business as part of its plan with Dell to divest more than $6bn in assets. Elliott Management had pushed EMC to sell itself and spin off VMware. (Bloomberg)