Dell ‘happy to take on’ EMC deal risk

Michael Dell says the merger with EMC is a risk that he is “happy to take on”.

Dell chief executive Michael Dell.

Just weeks after sealing the biggest tech deal in history, Michael Dell has said the merger with EMC is a risk that he is “happy to take on” and that the record $US67 billion ($93bn) purchase of the data storage major does not signify the top of an overinflated technology market.

Speaking at the Web Summit in Dublin, Mr Dell dismissed suggestions that the $US67bn price tag represented the top of the market.

Last month Dell announced it would pay $US67bn to buy data storage conglomerate EMC in a cash-and-stock deal.

The founder and chief executive of Dell explained the rationale behind the merger: “The combination of Dell and EMC together creates an incredible company, a company that is absolutely a leader in today’s IT — in servers, in storage, in virtualisation of PCs. And it creates a company that is a leader in tomorrow’s IT — in digital transformation, software-defined data centre, converged infrastructure, hybrid cloud.”

“It also creates a company with incredible scale; the number one enterprise systems company in the world,” Mr Dell said.

Asked how worried he was of the risks attached to the deal, Mr Dell said he was not afraid of risk.

“Risk goes along with innovation.

“One of the problems that larger companies have from the perspective of an entrepreneur is they think of risk as something to avoid … if you want to innovate you have to embrace risk.

“I’m happy to take on the risk and happy to go on a path that’s different to others,” he said.

Dell also admitted there was no guarantee the deal would add to shareholder value.

“The reality is we can’t be sure. But that’s how markets are made, to take on risk.

“Time will tell, but as I said, we’ve had an overwhelmingly positive reaction from customers.”

Dell also said the PC business isn’t going away.

“We’re still very much in the PC business. It’s a great business, we’re fully committed to it.

“It’s changing as well, we have virtual PCs, gaming PCs, high performance workstations and the foundation of that business is what’s driving the internet of things. So our large industrial customers are all embedding intelligence and we’ve got hundreds of IoT (Internet of Things) projects going right now, which are essentially little PCs inside equipment, making it intelligent to provide real-time insight.

“It’s a business that’s going to be with us for a very long time.”

Pointing out how far his “little start-up” has come over the past 30 years, Mr Dell said the company “has had revenues of $US900bn so far, so we’re going to have $US1 trillion pretty soon”.