Tech Latest: Japan's NTT Data to Purchase Dell's IT Services Unit
Japan's Nippon Telegraph & Telephone Corporation is reportedly buying the technology services businesses of American company, Dell for a disclosed amount of $3.05 billion. The acquisition was announced via a statement the NTT Data Corp released to the Tokyo Stock Exchange on Monday, although there was no specific date provided as to the consummation of the deal and the acquisition of the units from Dell.
According to the Boston Globe, NTT Data's purpose of acquisition is to obtain a stronger hold in North American business interests, particularly in the aspect of cloud services and business process outsourcing. The good news for Dell's current employees is that they will mostly likely be retained, all 28,000 of them, both from the North American offices and in India.
To date, this will be the Japanese company's biggest acquisition and there is a lot of sense in the business move. NTT Data is thriving in Japan, but it hasn't been that profitable outside its premises, though the company's website claims they have several of their services being used in North America.
Get Our Latest News for FREE
As for the part of Dell, selling this division is just one step of a massive effort to raise money in order to acquire and take over another giant in EMC Corporation, a software and storage systems company. For the American company, the technology services businesses no longer form part of their core, which implies that it already is a dispensable unit. In the proposed takeover of EMC, Dell is set to borrow/raise $50 billion to acquire the company, although that amount has since been modified.
NTT Data is an international company with rivals like Tata Consultancy Services Ltd. and Cognizant Technology Solutions Corp. They currently provide services to different industries, including healthcare and hospital facilities in the United States. They also provide software solutions for electronic medical records, insurance, surgery management, billing, and others.
