Dell spins off software division to private equity firms
Francisco Partners and Elliott Management to pay a rumoured $2 billion for the unit
Dell has confirmed it is selling off its software division to two private equity firms.
Francisco Partners and Elliott Management are buying the company's software assets, including IT management service Quest Software and encryption and data security business SonicWall, for a rumoured $2 billion, a smaller sum than Dell paid for Quest alone back in 2012.
John Swainson, president of Dell Software Group, said in a statement: "We're proud to have built a world-class portfolio of software solutions. Organisations across the world rely on Dell Software Group's combination of top-flight products, services and support to manage applications and data, secure their networks, protect critical information, derive key insights from data, and simplify their overall IT landscape.
"We look forward to continuing our focus on driving innovation and serving the critical needs of customers worldwide as part of the Francisco Partners and Elliott Management portfolio of companies."
The deal comes eight months after Dell announced its intention to acquire infrastructure giant EMC. It is unclear what impact, if any, this alleged sell-off plan will have on that acquisition, as EMC also has its own software divisions. Indeed, Elliott Management attempted to buy EMC in 2014, when it tried to persuade the company to spin off its 80 per cent share in VMware.
Dell has been already been selling off some of its assets ahead of the completion of the EMC merger - which is expected to happen in autumn this year - such as its services division in March.
As for the two private equity companies, Francisco Partners specialises in private equity investments in the technology sector and, according to Reuters, has raised $10 billion in capital and invested in more than 150 businesses over the past 15 years. Elliott Management, on the other hand, is an activist hedge fund that took a 7.1 per cent stake in virtualisation firm Citrix in June 2015.
Staying ahead of the game in the world of data
Create successful marketing campaigns by understanding your customers betterDownload now
Remote working 2020: Advantages and challenges
Discover how to overcome remote working challengesDownload now
Keep your data available with snapshot technology
Synology’s solution to your data protection problemDownload now
After the lockdown - reinventing the way your business works
Your guide to ensuring business continuity, no matter the crisisDownload now