DOW JONES NEWSWIRES
Dell Inc. (DELL) agreed to buy information-technology service
provider Perot Systems Corp. (PER), long seen as a Dell target, for
$3.9 billion as the company looks to diversify away from its core
personal-computer business which has been struggling for some
time.
Nearly 80% of Dell's revenue comes from corporate computer
buying, and they have been retrenching amid slumps in their own
businesses.
With Perot, whose shareholders would get a 68% premium to
Friday's closing price with the $30 offer, Dell will be able to
bolster Dell's information-technology services portfolio and expand
Perot's reach farther across the globe. Perot had been seeking to
expand internationally to reduce its exposure to the U.S.
The deal is set to close no later than January and not boost
Dell's earnings for several years. Its stock fell 5% premarket to
$15.85.
Perot will become Dell's services unit and will be led by its
current chief executive, Peter Altabef. Also, Dell's board will
consider Perot Chairman Ross Perot Jr. for a seat.
Last month, Perot said its second-quarter profit rose slightly
thanks to improved margins despite a drop in sales. But it gave a
third-quarter revenue forecast below analysts' expectations.
Meanwhile, Dell posted a 23% profit drop last quarter as it
continues to suffer from weak spending in technology.
-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291;
joan.solsman@dowjones.com
