The Dell Inc. and EMC Corp. merger announced on Monday is being called the biggest technology industry takeover ever by the Wall Street Journal
, involving some $67 billion in cash and stocks.
Dell said it will fund the blockbuster deal with a combination of new common equity from CEO Michael Dell and others, the issuance of tracking stock, new debt financing and cash.
Dell and EMC "will focus on rapid de-levering" in the first 18 months to two years after the deal closes.
"The combination of Dell and EMC creates an enterprise solutions powerhouse bringing our customers industry leading innovation across their entire technology environment," Michael Dell said in a statement
"Our new company will be exceptionally well-positioned for growth in the most strategic areas of next generation IT including digital transformation, software-defined data center, converged infrastructure, hybrid cloud, mobile and security. … I am incredibly excited to partner with the EMC, VMware, Pivotal, VCE, RSA and Virtustream teams and am personally committed to the success of our new company, our customers and partners."
According to Fortune
magazine, current EMC chairman and chief executive Joe Tucci would remain in that position until the deal closes, after which Michael Dell would become chairman of the new company.
Fortune said Dell's headquarters will remain in the Austin suburb of Round Rock, while the combined company's enterprise systems unit will be housed at EMC's home in Hopkinton, Massachusetts.
"I'm tremendously proud of everything we've built at EMC – from humble beginnings as a Boston-based startup to a global, world-class technology company with an unyielding dedication to our customers," said Tucci.
"But 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. I truly believe that the combination of EMC and Dell will prove to be a winning combination for our customers, employees, partners and shareholders."
The deal still must meet regulatory approvals and that of EMC's stockholder.
"This merger bodes well for the next generation of innovator," Matt McIlwain, a managing director at Madrona Venture Group, told Bloomberg Business
. Madrona invested in Isilon, which EMC acquired, and other storage startups that compete with EMC.
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