Why has Dell created the biggest tech merger in history with EMC?

The deal may help Dell raiser its profile in data centres
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Dell has agreed to buy data storage company EMC for $67 billion (£44 billion) – the biggest deal in history between two tech companies.

Michael Dell will be chairman and chief executive of the combined group, which Dell said would become the world’s largest privately controlled, integrated technology company.

"Our new company will be exceptionally well positioned for growth in the most strategic areas of next-generation IT," said Michael Dell.

"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,” added EMC boss Joe Tucci.

Dell will keep its headquarters in Round Rock, Texas, while its enterprise-systems business will be based in Hopkinton, Massachusetts – the current home of EMC.

The deal is expected to close some time around May and October 2016, but why has Dell decided to take what analysts are calling such a ‘brave move’, and what can we expect from this new partnership?

“The transaction creates the industry-leader in the extremely attractive high-growth areas of the $2 trillion IT market with complementary product and solutions portfolios, sales teams and R&D investment strategies,” reads Dell’s official statement.

“The transaction combines two of the world’s greatest technology franchises – with leadership positions in Servers, Storage, Virtualisation and PCs – and brings together strong capabilities in the fastest growing areas of our industry, including Digital Transformation, Software Defined Data Center, Hybrid Cloud, Converged Infrastructure, Mobile and Security.”

The firm has noted that the partnership will offer customers a broad, end-to-end product portfolio spanning all key compute, networking and storage segments, including both legacy and emerging products.

The deal is not just the biggest in history; it’s TWICE as big as the previous between Compaq and HP, which was valued at $433.4 billion and took place in 2001.

It’s thought that the deal will help Dell raise its profile in areas such as data centres, where EMC had 21 per cent of the storage market in 2014

Other super-sized tech acquisitions include Facebook buying WhatsApp for $19 billion in 2014, HP acquiring Electronic Data Systems for $15.4 billion in 2008, and Google grabbing Motorola Mobility for nearly $13 billion in 2008.

Distributor Tech Data has announced that it is now offering the full range of Dell printers in the UK and Ireland, giving resellers access to the vendor's comprehensive range of single-purpose and multi-function devices.

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