Rumor: Dell Is Interested in Purchasing EMC

Image Attribution: Flickr

Rumors among computing analysts are beginning to indicate that Dell may be interested in buying EMC. As you may remember, Dell recently became a private company sometime ago with its estimated value sitting around $25B. Many analysts say that EMC’s valuation eclipses Dell’s valuation, although much of EMC’s value comes from the fact that the company is owned by VMware.
The move seems to make sense on paper, given the fact that Dell has made strides over the past year to become the de facto private cloud storage infrastructure provider. Reuters is reports that Dell has been in contact with its financiers, in efforts to propose a deal. This isn’t the first time that EMC has been rumored to be on the selling block.
Several months ago, indications from those in the know at HP said that EMC was being considered as a buyout target for HP. Unable to come to terms on a deal, the HP/EMC deal never happened. With the Wall Street Journal reporting that Dell is serious about its bid to take over EMC, the potential acquisition has the potential to be one of the most talked about acquisitions of the year.
Unfortunately, both Dell and EMC have declined to provide comments about the rumors surrounding the two companies. The Wall Street Journal story on the potential Dell/EMC merger contends that an activist investor in EMC (Elliott Management) wanted EMC to become its own company, separate from VMware.
Regardless of the rumors of a potential buyout looming for EMC, investment analysts say that the talk of a buyout has actually helped the stock price of EMC. In one day, EMC’s ticker quote jumped 8% on the rumors of a buyout. Although both companies refuse to confirm or deny these rumors, with large outlets such as Reuters and WSJ reporting on the speculation, its entirely possible that this deal could happen soon.