Dell Inks Deal For Compellent, Will Resell Compellent In Meantime

Printer-friendly version Email this CRN article

Dell Monday said it inked a definitive agreement to acquire Compellent, a move that would give it an enterprise-class storage offering and a built-in channel to sell it.

Dell also has entered into a reseller agreement with Compellent that will bring Compellent's storage technology to Dell's direct and indirect sales channels.

Dell plans to buy Compellent for about $27.75 per share, or a total of $960 million, if Compellent's cash on hand of about $140 million is included.

Dell and Compellent Thursday first unveiled their intention to merge at a price of $27.50 per share. That represents a significant discount, as Compellent share prices topped $34 per share early last week.

In addition to the new reseller agreement with Compellent, Dell is continuing to sell its own PowerVault lines and resell EMC products, said Brad Anderson, senior vice president of Dell's Enterprise Product Group.

Compellent will give Dell new ease-of-use and automated tiering capabilities to help customers increase their storage functionality and reduce storage costs, Anderson said.

"We are absolutely committed to the storage industry," he said.

Phil Soran, president, CEO and chairman of Compellent, is expected to take a vice president post at Dell post-acquisition. Soran said his company will bring more than 2,500 midsize enterprise, large enterprise and cloud customers, as well as 450 channel partners worldwide, to Dell.

For Compellent's channel partners, the acquisition by Dell will mean new opportunities as part of a larger company with a global distribution base than they would have had if Compellent remained independent, Soran said.

"The bottom line: The opportunity is bigger now, and we'll have more resources to drive the channel," he said.

Dell also signed retention agreements with all of Compellent's key executives and plans to offer jobs to all Compellent employees, Soran said.

Dell has not yet reached out to Compellent's channel partners, as the two are still being run as separate companies, Anderson said. However, Dell has told its channel partners to reach out to Compellent to start forming relationships, he added.

Compellent has reached out to its channel partners, who said they are excited about working with Dell, according to Soran.

"The majority say Dell has big opportunities for them," he said.


NEXT: Compellent VAR Sees Enterprise Opportunity

Printer-friendly version Email this CRN article