Dell plans asset sale to pre-empt EMC debt

Company lines up software, services units in shop window to offset $49.5bn debt burden

Tags: Dell CorporationEMC CorporationMergers and acquisitionsQuest Software IncorporatedSonicWALL IncorporatedUSAVMware Incorporated
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Dell plans asset sale to pre-empt EMC debt (Getty Images)
By  Stephen McBride Published  November 3, 2015

Dell is planning a fire sale of secondary assets worth around $10bn in preparation for its acquisition of EMC, Reuters reported.

Dell's sale of some of its software and services is intended to take the sting out of the debt it must shoulder as part of the EMC purchase. The deal, now reportedly priced at $67bn, will require Dell to borrow $49.5bn.

Possible business units that could be put up for sale include cyber-security division SonicWall; backup solutions provider AppAssure; and IT management specialist Quest Software. But Dell will likely keep its server business as it complements EMC's enterprise portfolio.

Since going private just over two years ago, Dell has diverted its focus from the dwindling PC market to the enterprise segment. Its acquisition of EMC will allow it to compete more robustly with companies such as IBM and Cisco. The deal for EMC shareholders will include tracking stock in VMware, the strongly performing virtualisation firm in which EMC has a majority stake.

 

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