August 31, 2016

$67B EMC sale to Dell cleared; to close next week

The two companies will merge Sept. 7 and be known as Dell Technologies.

The long regulatory road for a merger between Texas' Dell Technologies and EMC Corporation of Hopkinton will come to an end on Sept. 7 after the $67 billion acquisition received Chinese regulatory approval.

Approval from China's Ministry of Commerce (MOFCOM) was the last hurdle for the acquisition to clear after EMC shareholders voted in favor of the agreement in July. According to Michael Dell, chairman and CEO of Dell Technologies, the merger will be beneficial for both companies, using the power of 140,000 employees worldwide to achieve scales of economies as the company moves into new and growing technology markets.

"I am proud of everything we've built at EMC – from humble beginnings as a Boston-based startup to a global, world-class technology company with an unyielding dedication to our customers," Joe Tucci, chairman and chief executive officer of EMC, said in a statement.

The takeover's $67-billion price tag is way above the current record-holding tech buy -- the $25-billion sale of Compaq Computer to Hewlett-Packard in 2002.

Still unresolved in the matter is what would happen to EMC employees, including the nearly 10,000 in Massachusetts. Approximately 800 people were laid off at EMC's subsidiary VMware, where there were also shifts in the company's leadership.

Upon the closing of the deal, EMC shares will cease to be traded as public stock and shareholders will receive $24.05 per share in cash in addition to a newly issued tracking stock linked to a portion of EMC's economic interest in the VMware business.


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