News

Dell-EMC Deal Gets Approval from Feds

• By Keith Ward
• February 23, 2016

Dell's planned acquisition of VMware parent company EMC has just cleared a major hurdle.

The two companies on Wednesday announced that the Federal Trade Commission (FTC) has approved the buyout, which will "create the world's largest privately-controlled, integrated technology company." The so-called "waiting period" for any antitrust concerns to be raised expired at 11:59 p.m. EST on Feb. 22, the announcement said, paving the way for Dell and EMC to keep moving forward.

Much more needs to be done to make the sale official, but this incremental step was an important one. Government interference in a sale has the potential to scuttle any deal, especially one worth as much as the $67 billion Dell said it would pay for EMC.

The biggest remaining challenge for the sale itself may be raising all the cash Dell needs -- and which it doesn't currently have. As reported earlier this month, Dell has found it difficult to come up with the necessary funding, due at least in part to a steep decline in tech stocks and an inability to dump assets.

Once the merger takes place (assuming it does), the problems of integrating such large companies present another huge obstacle. From VMware's point of view, the key question is whether Dell will maintain the hands-off management style that worked well when EMC owned the company.

In the press release, Dell CEO Michael Dell expressed his happiness with the FTC decision. "We are delighted that, with this key regulatory milestone now complete, we have taken another step on our path to becoming a combined company. Our teams are engaged in integration planning and all transaction-related workstreams are on track."