Dell is to sell its consulting services division to NTT Data – a subsidiary of Japanese telecoms giant NTT – in a $3.05bn deal that will help Dell to pay for its $67bn acquisition of storage vendor EMC.
NTT Data, meanwhile, will gain a bigger footprint in the US by picking up a business that is based largely on Perot Systems, which Dell acquired seven years ago.
The news comes some six weeks after it was reported that Dell was struggling to raise the funds to fully finance the EMC acquisition, and was looking to sell a number of assets to make good the gap.
However, according to newswire Reuters, Dell has also made some progress over the financing of its EMC acquisition, with its $10bn ‘term A’ loan now over-subscribed and expected to be increased in size by between $500m and $750m. Syndication of the loan should be completed within around a week.
Reuters also reports that Dell is looking to offload Quest Software and SonicWall to private equity buyers in deals valued at as much as $4bn. IT management software maker Quest had only been acquired by Dell in July 2012 in a $2.36bn deal. Firewall software vendor SonicWall was also acquired in 2012, but for an undisclosed sum.
Dell had acquired much of its consulting services as a result of the $3.9bn acquisition of Perot Systems in September 2009. Perot had been founded in 1988 by former US presidential candidate Ross Perot after he had sold his previous company, EDS, to General Motors. EDS is now part of Hewlett Packard Enterprise (HPE).
NTT Data was founded in 1967 and has revenues of around $16bn. Fifty-four per cent owned by NTT, it has expanded outside of Japan in recent years via a series of acquisitions, including London-based design and technology consultancy RMA Consulting in 2012. If its purchase of Dell’s consulting services unit goes ahead, the deal will represent its largest acquisition to date.