Enterprise, Mergers and Acquisitions

NTT Data Bid for Dell Perot Arriving This Week?


NTT Data this week is expected to offer $3.52 billion to acquire Dell's IT services business, which consists mainly of the former Perot Systems company, Nikkei Asian Review is reporting. If the deal materializes, Dell would gain cash to help strengthen the company's balance sheet ahead of the pending $67 billion buyout of EMC.

According to Nikkei Asia Review:

"Nippon Telegraph & Telephone is expected to offer more than 400 billion yen ($3.52 billion) to buy Dell's IT services business in a move aimed at bolstering the Japanese company's presence abroad. NTT seeks to acquire the business, which consists mainly of Perot Systems and generates around $3 billion in annual revenue, through subsidiary NTT Data. NTT Data President Toshio Iwamoto will formally present an offer to Dell executives in the U.S. this week. NTT Data is expected to enter into exclusive negotiations on the purchase."

ChannelE2E has not independently confirmed the Nikkei report. However, rumors about NTT emerging as the exclusive bidder for Dell Perot surfaced in February 2016. Other potential suitors allegedly included Atos (a French IT services firm) and Cognizant Technology Solutions. But Atos denied interest in Perot in February, and Cognizant delivered a weaker-than-expected forecast for fiscal 2016 — which suggests a potential bid for Dell's IT services business is unlikely.

Dell's Bigger Strategy

Dell Technologies CEO Michael Dell
Michael Dell and his financial team are striving to strengthen the company's balance sheet ahead of the $67 billion EMC buyout, which is expected to close between May and October 2016.

Dell and EMC officials insist the deal is on track. However, funding for the deal appears to be arriving a bit later than originally expected due to turbulent financial markets plus a holiday in Asia that recently slowed down financial negotiations, reports have stated.

To further strengthen its financial footing, Dell plans to IPO SecureWorks -- the company's managed security services platform -- sometime in 2016. There have also been rumors about Dell potentially selling off pieces of its software business -- including the Quest Software assets. But those rumors have died down in recent weeks.

Amid all of those potential moves, Dell and EMC have remained focused on their pending M&A deal. The companies have formalized their executive leadership plans for the post-merger business. And VMware, which is majority owned by EMC, is hosting VMware Partner Leadership Summit 2016 this week in Arizona.


Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.