DellEMC

Dell's Mega EMC/VMware Deal
Dell's record-breaking $67B buyout of EMC will create a ~$75B enterprise tech giant...Let's discuss
Rob Steele
The Dell and EMC merger will create the world’s largest PRIVATELY-controlled, end-to-end technology company. Will this new private company give a stronger advantage against publicly traded competitors?
Keith Townsend - Light will overcome darkness
I think the biggest challenge will be cash flow to make investments/acquisitions. But, I said the exact same thing about Dell.
Rob Steele
@CTOAdvisor yep, and DELL was able to secure funding for the largest IT deal in history. I don't see them having problems locking down additional funds in the future. Even though they already have all the tools / solutions they need.
Dave Vellante
Well Dell can write its own narrative and not be affected by stock price
Rob Steele
obviously Elliot Management had some influence on getting this deal done, but now that outside influence is less likely... Do we see more IT innovation and less financial hesitations ?
John Furrier
Elliott Management is the Gordon Gecko of today's world without them this wouldn't have happened
Rob Steele
@furrier one of the many reasons why the Open Source community is thriving!
Girish Gurudutt
end-to-end in software ??
Phil Dunn
End to End? Not truly. No Database, no middleware, no applications, no archive but it’s a start.
Rob Steele
@Phil_Dunn1 end to end infrastructure; there are plenty of open source DB options; middleware? the new play is open API; between the two companies there are plenty of applications including SourceOne and Dell Archive manager... both are archiving apps.
Phil Dunn
sure but nothing that Dell/EMC can truly control and own to improve and optimize and offer a full end to end optimized & integrated HW + SW stack. Customers are sick of being integrators. Offering just HW integration not enough
de-cen-tra-liz-ed
> this merger is directed squarely at Big Blue and HP and both may need to do something about it but for different reasons >
John Furrier
don't forget oracle
Dave Vellante
@furrier I agree - Oracle's strategy looks clean here
John Furrier
HP will be impacted the most imo; Michael Dell has huge target on HP
Keith Townsend - Light will overcome darkness
Will Dell control of VMware impact relationships with server hardware partners? One advantage of the federation was VMware's ability to partner with other storage companies outside of EMC. Remember how important the NetApp/VMware relationship was/is?
Keith Townsend - Light will overcome darkness
Will this spur investment in KVM alternatives? A strong VMware=A stronger Dell. That's not good for HP or Cisco.
Phil Dunn
Yes clearly -as all HW vendors besides Oracle will now be shopping for alternative hypervisors to partner with. Good thing theres several open source variants.
Steve Herrod
Most interesting tech overlap? SecureWorks+RSA? EMC+Compellent+Equalogic? VCE+EVO+DellCI?
Dave Vellante
Ick - I guess #3
Dave Vellante
best thing about VCE is Cisco...let's swap that out...
John Furrier
. @herrod wondering what will be the resulting offerings be. will this hurt the buyer market for startups? will this stall M&A?
Dave Vellante
sorry - VMware not too bad either - let's keep that piece in there
Keith Townsend - Light will overcome darkness
don't forget Dell Networking + VMware NSX. Indirect but potentially powerful combination.
John Furrier
Run D(ellE)MC ...I love this comment from Steve Herrod ‏@herrod former CTO #VMware now VC
Steve Herrod
You can say it as: "Run! DMC!" or "Run, DMC!" or "Run DMC?" :)
Keith Townsend - Light will overcome darkness
one synergy is that they can get a great group discount on VMworld/DellWorld/EMCWorld entertainment.
Girish Gurudutt
will some one need to integrate all the products and provide single point of contact to customers ? who takes the role ? plans
Girish Gurudutt
need to build on the vision of steve and paul; taking a little long or losing direction ??
Girish Gurudutt
does the federation want to provide full stack and be compared with google ??
Muddu Sudhakar
SecureWorks+RSA make tier 2 solutions; Cannot compete with Security leaders
John Furrier
EMC management understand how to run a conglomerate one benefit of running the federation. Michael Dell @michaeldell is a master too
John Furrier
I wonder if spinning out companies will be in the future - conglomerate model - series of pure plays can generate lots of cash imo
Keith Townsend - Light will overcome darkness
EMC's management also knows how to keep VMware hardware and software partners happy with the exception of Cisco. This will be needed as the server partnerships are at stack.
David Oro
Siliverlake is a fan of the Federation http://fortune.com/2...
de-cen-tra-liz-ed
> @furrier it's also about cloud, but i'm not convinced Oracle's is on par with the other 2 (HP less so than IBM) >
Rob Steele
the federation is all about taking care of current technology needs while fueling the journey to the cloud.
John Furrier
@DavidOro great point and the ability to financially engineer ROI plus product technology execution
Govind Saria
What will be the impact of this deal on vmware stockholders?
...
screwed - VMW stock down by 10% already.
John Furrier
@cloud_opinion VMware will bounce back it's too valuable
John Furrier
Not sure Pat Gelsinger is happy about this
Govind Saria
@furrier but the future of vmware doesn't look very promising. loosing execs and now this merger
Govind Saria
He doesn't have any choice, Does he?
scott brightwell
VMware remains public. Not much changes for them structure-wise @govind_saria
Tim Crawford
Q: Does the Dell/ EMC merger help move away from hardware or entrench them further?
John Furrier
it will entrench them further but that is a good thing bc dell can win big with sales increase in short term and invest in the future
Stuart Miniman
Michael Dell's comments on CNBC sounded like boosting server business is one of the benefits that they are looking for - EMC uses and sells lots of x86 (appliances, etc)
John Furrier
I wonder about VCE that is billions in sales
Anurag Agrawal
Dell should really adopt the software and cloud DNA of VMware which Dell is lacking. But then these are not immediate huge revenue drivers.
Dave Vellante
I don't fully understand the math of this transaction and how we get to $67B
Tim Crawford
Increasingly, there has been a premium paid to lock up deals quickly. !=Logical.
Dave Vellante
If EMC shareholders get $24.05 per share (there are approx 2B emc shares outstanding) that's about $48B in cash
Bill Plein
Don't forget the tracking stock.
Leo Leung
- sounds like an intense blog post
Rob Steele
if anyone can do the math, Dave is the man !
Dave Vellante
They get another ~$8/share in the form of a VMware tracking stock - which is about $16B - so that gets you to the mid $60B
Dave Vellante
But .111 in a vmware tracking stock w/ 422M shares outstanding equates to about $3B -
Dave Vellante
So where's the other roughly $13B come from
Keith Townsend - Light will overcome darkness
how much of EMC debt will Dell be assuming?
Keith Townsend - Light will overcome darkness
EMC has 5.5B of outstanding debt. So that adds to the total http://quicktake.mor...