Dell Official Reaffirms Progress On Deal To Buy EMC

The Dell executive in charge of the integrating the company with EMC Corp. is firing back at reports that claim financing for the blockbuster deal is uncertain.

In a letter to employees, Rory Read, Dell's COO and chief integration officer, counters arguments made recently that Dell was having difficulties putting together the financing it needs to close the acquisition of data storage giant EMC.

Paul Neyman, president of Houston-based Dell partner Waypoint Solutions, said he keeps an eye on all the will-it-or-won't-it news concerning the Dell-EMC merger, but stressed that he must plan for either outcome.

[Related: Report: Dell Hits Financing Hiccup In Blockbuster $67B EMC Acquisition]

"We look for signs as to what impact the merger activities have on Dell's market and sales strategies while we're waiting," Neyman said. He added that Waypoint has also begun to train its sales and engineering teams on EMC products.

"We've reached out to the EMC folks to begin conversations on how we work together," Neyman said. "Our intent is to be prepared either way, and hopefully at the end of the day we see new upside."

Read's letter was filed with the U.S. Securities and Exchange Commission (SEC) Tuesday. In it, he makes the same argument Dell CEO Michael Dell and EMC CEO Joe Tucci have made recently, namely that the merger, the largest in technology industry history, is on track and set to close on its original timetable, between May and October.

"I want to address some of the chatter over the past few weeks about possible financing headwinds with the transaction," he wrote. "I can assure you any suggestions our debt financing is in jeopardy are off target and do not reflect our financing terms and the progress of our financing to date. The debt financing is fully committed and is being underwritten by many of the leading global banks. The process of syndicating and placing the debt for a transaction of this nature frequently encompasses a time period of several months from start to finish. That process currently is underway and remains on track, as planned."

It was reported last week that sagging credit markets had prompted the coterie of banks financing up to $49.5 billion of the merger to ask for more time to put a financing package together. That group of banks includes Credit Suisse, JP Morgan, Barclays, Bank of America, Citi, Goldman Sachs, RBC Capital and Deutsche Bank.

Dell intends to offset some of that debt by offloading business units, and sources told CRN Tuesday that Dell is in an exclusive, 30-day negotiation period with Tokyo-based NTT for the sale of Perot Systems, an IT consulting business Dell acquired in 2009.

On Monday, Dell acknowledged that steep declines in the stock price of VMware – which is 80 percent owned by EMC – would drive down the cost of the acquisition. When it was originally announced, the deal came to about $67 billion. If it closed today, it would be valued at around $59.5 billion, according to Dell.

Read highlighted recent financial results from EMC and VMware, and asked employees to continue focusing on customers and "business at hand." He said employees would receive surveys asking for their opinions on the merger and how well executives at both companies are handling it.

"People always ask me what they can do to help with the integration," Read said. "The number one thing each of us can do is to focus on our customers and current business at hand. We must deliver on our current business commitments and continue helping our customers solve their problems and win. This is something you can directly control and it is the most important thing we all can all do."

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