Dell to buy EMC Corp: Reports

Dell Inc is all set to buy EMC Corp and is also talking with banks to finance an all-cash offer for the data storage company, Reuters reported citing a source who requested anonymity due to the confidential nature of the negotiations.

EMC has a market capitalisation of about $50 billion as of yesterday's close.

The deal could further strengthen the world's third-largest personal computer maker's presence in the corporate sector at a time when founder Michael Dell had been trying to transform the company he founded in 1984 into a complete provider of enterprise computing services like Hewlett-Packard Co and IBM.

EMC has been under pressure from activist investor and shareholder Elliott Management Corp, which is pushing the company to spin off its majority-owned VMware Inc unit.

Dell went private in a roughly $25 billion buyout by its founder, Michael Dell, and private-equity firm Silver Lake and has since been looking for play in more-profitable areas like storage and security (See: Michael privatises Dell, delists from Nasdaq).

According to commentators, a deal with EMC would see Dell transition from a consumer-facing company to one focused on technology for big companies - a very different company from the one Dell founded in his University of Texas dorm room in 1984.

Dell still carried over $11.7-billion in debt, according to FactSet and it was not clear how it would finance a potential purchase of part or all of EMC, or what role, if any, Silver Lake would play.

EMC would report its quarterly earnings on 21 October and according to some analysts the company had until then to announce a deal or risk a proxy fight.