Dell to Acquire Perot Systems for $3.9 Billion, Creating Comprehensive, Customer-Focused IT-Solutions Company
September 21 2009 - 8:04AM
Business Wire
Dell and Perot Systems have entered a definitive agreement for
Dell to acquire Perot Systems in a transaction valued at
approximately $3.9 billion. Terms of the agreement were approved
yesterday by the boards of directors of both companies.
The acquisition will result in a compelling combination of two
iconic information-technology brands. The expanded Dell will be
even better positioned for immediate and long-term growth and
efficiency driven by:
- Providing a broader range of IT
services and solutions and optimizing how they’re delivered;
- Extending the reach of Perot
Systems’ capabilities, including in the most dynamic customer
segments, around the world; and,
- Supplying leading Dell computer
systems to even more Perot Systems customers.
Complementary Capabilities
Dell and Perot Systems share several key characteristics and our
products, services and structures are overwhelmingly complementary.
They have similarly strong, relationship-based business cultures.
People in both organizations are recognized for helping customers
thrive by using IT for greater effectiveness and productivity. The
combination also provides some compelling opportunities for
improved efficiency, which will benefit our customers even
further.
Dell’s global commercial customer base spans large corporations,
government agencies, health-care providers, educational
institutions, and small and medium enterprises (SME). The company’s
large existing services business includes breakthroughs in the
concept and delivery of modular services, as well as expertise in
infrastructure consulting and software-as-a-service. Dell is a
leader in computer systems, including standards-based network
servers, and in the fast-growing segment of data-storage
hardware.
Perot Systems provides world-class services, including in
applications, technology, infrastructure, business processes and
consulting. The company is a leading provider to clients in
health-care, government and other commercial segments, from SMEs to
the largest global institutions. Perot Systems has a large and
growing base of customers and service-delivery capabilities in
North America; Europe, the Middle East and Africa; and Asia.
Over the past four quarters Dell and Perot Systems had a
combined $16 billion in enterprise-hardware and IT-services
revenue, with about $8 billion from enhanced services and
support.
Tender Offer, Closing and Initial Integration
Under the terms of the agreement, Dell will commence a tender
offer to acquire all of the outstanding Class A common stock of
Perot Systems for $30 per share in cash. The transaction is not
subject to a financing condition. The transaction, which is subject
to customary government approvals and the satisfaction of other
customary conditions, is expected to close in Dell’s
November-January fiscal quarter.
Once the acquisition is complete, Perot Systems will become
Dell’s services unit and be led from Plano by Peter Altabef, the
current Perot Systems chief executive officer. At the same time,
Dell directors are expected to consider Ross Perot Jr., Perot
Systems’ chairman of the board, for appointment to the Dell board.
Based on current estimates, the transaction is expected to be
accretive to Dell’s GAAP earnings in its fiscal 2012.
To hear a related analysts call with Dell and Perot Systems
executives (“live” at 8:30 A.M. EDT today, then later via replay),
go to www.dell.com/investor.
Quotes:
Michael Dell, Chairman of the Board and Chief Executive
Officer, Dell: “We consider Perot Systems to be a premium asset
with great people that enhances our opportunities for immediate and
long-term growth. This significantly expands Dell’s
enterprise-solutions capabilities and makes Perot Systems’
strengths available to even more customers around the world. There
will be efficiencies from combining the companies, but the
acquisition makes such great sense because of the obvious ways our
businesses complement each other.”
Ross Perot Jr., Chairman of the Board, Perot Systems:
“This transaction represents a great opportunity for our company
and our associates. Today’s announcement is the next step in
formalizing a relationship that has flourished for some time. When
my father founded Perot Systems he envisioned a global
information-technology leader. The new, larger Dell builds on that
promise and its own successes by taking Perot Systems’ expertise to
more customers than ever.”
About DELL
Dell Inc. (NASDAQ: DELL) listens to customers and delivers
innovative technology and services they need and value. For more
information, visit www.dell.com. Investors wishing to communicate
directly with Dell may go to www.dell.com/dellshares.
About Perot Systems
Perot Systems Corporation (NYSE: PER) is a worldwide provider of
information technology services and business solutions. Through its
flexible and collaborative approach, Perot Systems integrates
expertise from across the company to deliver custom solutions that
enable clients to accelerate growth, streamline operations and
create new levels of customer value. Headquartered in Plano, Texas,
Perot Systems reported 2008 revenue of $2.8 billion. The company
has more than 23,000 associates located in the Americas, Europe,
Middle East and Asia Pacific. Additional information on Perot
Systems is available at www.perotsystems.com.
Special Note:
The planned tender offer described in this release has not yet
commenced. The description contained in this release is not an
offer to buy or the solicitation of an offer to sell securities. At
the time the planned tender offer is commenced, Dell will file a
tender offer statement on Schedule TO with the Securities and
Exchange Commission (the "SEC"), and Perot Systems will file a
solicitation/recommendation statement on Schedule 14D-9 with
respect to the planned tender offer. The tender offer statement
(including an offer to purchase, a related letter of transmittal
and other tender offer documents) and the
solicitation/recommendation statement will contain important
information that should be read carefully before making any
decision to tender securities in the planned tender offer. Those
materials will be made available to Perot System’s stockholders at
no expense to them. In addition, all of those materials (and all
other tender offer documents filed with the SEC) will be made
available at no charge on the SEC's website:
www.sec.gov.
Statements in this release that relate to future results and
events are forward-looking statements based on Dell's and Perot
Systems’ current expectations, respectively. Actual results and
events in future periods may differ materially from those expressed
or implied by these forward-looking statements because of a number
of risks, uncertainties and other factors. All statements other
than statements of historical fact are statements that could be
deemed forward-looking statements, including the expected benefits
and costs of the transaction; management plans relating to the
transaction; the expected timing of the completion of the
transaction; the ability to complete the transaction; any
statements of the plans, strategies and objectives of management
for future operations, including the execution of integration
plans; any statements of expectation or belief; and any statements
of assumptions underlying any of the foregoing. Risks,
uncertainties and assumptions include the possibility that expected
benefits may not materialize as expected; that the transaction may
not be timely completed, if at all; that, prior to the completion
of the transaction, Perot Systems’ business may experience
disruptions due to transaction-related uncertainty or other factors
making it more difficult to maintain relationships with employees,
licensees, other business partners or governmental entities; that
the parties are unable to successfully implement integration
strategies; and other risks that are described in Dell’s and Perot
Systems’ Securities and Exchange Commission reports, including but
not limited to the risks described in Dell’s Annual Report on
Form 10-K for its fiscal year ended January 30, 2009 and Perot
Systems’ Annual Report on Form 10-K for the fiscal year ended
December 31, 2008. Dell and Perot Systems assume no obligation and
do not intend to update these forward-looking statements.
DELL is a trademark of DELL Inc.
Perot Systems is a trademark of Perot Systems Corp.
Dell disclaims any proprietary interest in the marks and names
of others.
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