Report: Dell Raising Funds For Blockbuster EMC Buy, VMware Will Be Part Of Deal


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Dell may be close to a deal to acquire EMC in a buy that would also include a controlling interest in VMware.

Bloomberg on Thursday reported that Dell is already talking to multiple banks about raising at least $40 billion to finance the purchase of EMC and VMware, with the deal coming to a close as soon as next week.

While other reports have discussed the potential for Dell to acquire EMC, Bloomberg's specifically states that Dell would also purchase EMC's controlling stake in VMware.

[Related: Report: Dell In Talks To Buy EMC, Partners See Potential For New Enterprise Powerhouse]

Under the terms of the deal, Bloomberg reported, Dell would likely take EMC private while keeping VMware public, with Dell possibly selling a portion of the EMC stake in VMware as part of its fundraising plan. Even so, Bloomberg noted, a Dell-EMC merger deal may not happen.

VMware is a big part of EMC's business. EMC has an 80-plus percent stake in VMware. However, while EMC has a market capitalization of about $50 billion, VMware's market cap reaches almost $35 billion.

Several Dell solution providers said they are hopeful VMware will be part of any deal by Dell to acquire EMC. 

"The real crown jewel is VMware, so that's very interesting," a CEO for a top Dell solution provider who did not want to be identified said of the possible deal.

The CEO of a CRN Solution Provider 500 company said the acquisition would be much better for the channel if VMware were included.

"We're a strong EMC partner, a strong VMware partner, and a strong Dell partner, so this is potentially very interesting, and makes a lot of sense," the solution provider told CRN.

Jamie Shepard, senior vice president for health care and strategy at Lumenate, a Dallas-based solution provider and longtime EMC and VMware channel partner, said a Dell acquisition of VMware would be neutral.

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