EMC Eyes Merger and Explores Options, Amid Shareholder Pressure

SAN FRANCISCO (TheStreet) -- Data storage titan EMC (EMC) recently held merger discussions with Hewlett-Packard (HPQ) and deal talks with Dell, according to a report in The Wall Street Journal on Sunday. In both cases, however, it remains to be seen if a transaction will eventually emerge.

EMC's stock, nonetheless, closed higher Monday, while the broader markets ended the day in the red. EMC closed at $29.68 a share, up 0.51%. 

Must Read: Warren Buffett's Top 10 Dividend Stocks

The data storage giant and HP have flirted with each other across the table for most of the year. But that dance recently ended and it appears questionable as to whether the parties will return, the WSJ reports. As for Dell, an acquisition of only a portion of EMC's assets, such as its storage business, may be more in line with what the privately held company can carry off, observed the Journal.

EMC reportedly has hired banking advisers JPMorgan Chase (JPM) to give it guidance on the options it can explore, says the Journal.

One party that is more than willing to offer some free advice is shareholder activist Elliott Management. In July, Elliott Management was angling to push EMC to spin off VMware (VMW) . EMC holds approximately an 80% stake in VMware, which uses software to virtualize a company's infrastructure from cloud computing to data centers.

VMware is among the fastest growing units for EMC -- not to mention that it holds a market capitalization of $40.4 billion to EMC's market cap of $60 billion. During EMC's second-quarter earnings announcement, the storage maker cited a 5% increase in revenue growth to $5.9 billion. But VMware's 17% revenue growth stole the show.

If you liked this article you might like

Here the One Business That Could Fit 'Perfectly' Inside Meg Whitman's Overhauled Hewlett Packard

HP Enterprise Could Use an Expected Software Windfall to Make Hardware Acquisitions

7 Stocks Trading on Big Volume -- and What to Do With Them Now

EMC Stock Higher, Dell's $63 Billion Deal Closing Next Week

John Paulson Bought These 5 Stocks -- but the Charts Say Sell