Updated with new stock price
The move, announced Monday, comes after more than two years of overhaul efforts to revitalize Dell's slumping PC business. With Perot Systems, Dell hopes to expand beyond its hardware focus into IT services in growth regions like China. The deal also puts Dell in line to capture an upswing in health-care spending as reformers call for sweeping digitization of medical records.
The deal is "about expanding opportunities on a geographic basis," said Michael Dell during a CNBC interview Monday. PC rivals IBM and H-P have spent the past few years broadening their businesses into technology services like information systems design, consulting and network management.Dell's deal for Perot mirrors H-P's big shift into IT services last year, when it bought EDS for $13.9 billion. Perot Systems is the largest acquisition since founder Michael Dell returned to lead the company in 2007. The company has had about eight acquisitions in the past three years, said Dell. When asked if Perot would end the company's acquisition streak, Dell said "I would look for more." The deal is seen as another sign that merger and acquisition trends may be heating up in the tech sector, where large players have socked away cash over the past several years. Dell wasn't stingy with its offer. The $30-a-share bid was an eye-popping 67% premium over Perot's closing stock price of $17.91 Friday.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
24/7 market commentary from Jim Cramer and 20+ veteran Wall Street gurus. Get access to the latest trading ideas on stocks, options, and ETFs as well as a real-time forum to see the pros exchanging their investment ideas.
- Jim Cramer + 20 Wall Street pros
- Intraday commentary & news
- Real-time trading forum
- Actionable trade ideas
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV