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Last October, Dell entered into an important tech deal in historic previous, when it bought info storage agency EMC for $67 billion. Now, the know-how agency will shed under-performing property and recoup larger than $2 billion, by selling its software program program division to private equity company, Francisco Partners, and activist hedge fund, Elliott Management.
Rumors of the billion-dollar sale had been first reported by Reuters early Monday morning. In a joint press release issued numerous hours later, the companies confirmed the sale, nonetheless not the amount.
The deal consists of Quest Software, which helps with knowledge know-how administration, along with SonicWall, an e mail encryption and knowledge security provider. It would possibly moreover embrace totally different software program program property consistent with TechCrunch, nonetheless probably not Boomi, a smaller asset specializing in cloud-based software program program integration.
One fascinating aspect of the sale is the rumored $2 billion ticket. Four years previously, Dell purchased Quest and SonicWall for $3.6 billion. If Dell is selling it at a loss, it'd level out the company's rush to divest its poor performing software program program property sooner than EMC shareholders vote on its deal on July 19.
The $2 billion would moreover help Dell pay for the EMC acquisition. This yr, the company raised $3 billion when it supplied its IT consulting division Perot Systems to Japan's NTT Data Corp in March. In April, Dell raised an extra $112 million when it took its cyber security unit SecureWorks public.
The purchaser, Elliott Management, is the sale's totally different fascinating aspect. In 2014, the hedge fund took a $1 billion stake in EMC and pushed the data-storage giant to interrupt apart. The care for Dell saved EMC from splitting and Elliott Management's shareholder activism. But it may need merely been part of the hedge fund's larger method to develop itself inside the know-how sphere.
According to the New York Times, Elliott Management knew Dell was critical about selling its software program program division and was conscious of that kind of corporate-focused enterprise. Jesse Cohn, the fund's head of United States equity activism, quietly constructed a gaggle named Evergreen Coast Capital that may buy firms like an actual private equity enterprise. This new affiliate actually made the care for Dell.
"Elliott has been a long-term investor inside the know-how space and at the moment's announcement continues our progress," Cohn talked about inside the press launch Monday.
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