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Atos Close to Acquiring Dell’s IT Services Unit

France-based IT services company Atos is reportedly close to reaching a deal with Dell Inc to acquire Perot Systems for around $4 billion no that TCS, Cognizant Technologies, and NTT Data have all withdrawn from the race, according to a report by tech publication Re/Code .
Dell acquired Perot Systems for $3.9 billion six years ago, but the tech giant is now believed to be selling its IT services unit in an effort to raise the staggering $50 billion that it needs to repay the loan it borrowed to acquire storage giant EMC. That may not be the lone reason, as some analysts say Dell no longer wants its core business in its IT services unit, which reportedly generates annual revenue of around $2.8 billion per year.
Despite the high asking price, some analysts believe that Dell’s IT unit is less attractive than that of many competitors because they it relies on old technologies while today’s IT services industry is driven largely by newer technologies.
For Perot Systems, healthcare is the biggest vertical. This is precisely what lured Cognizant Technologies to the negotiation table. Cognizant has already gained a large number healthcare clients after buying TriZetto Corp for $2.7 billion. Therefore, it is not clear why Cognizant made a bid for Perot Systems.
Dell is also taking public its computer security subsidiary SecureWorks, which is likely to be listed in the U.S. stock market some time this year. Dell wants to raise as much as $100 million from the stock sale.
Dell first started shopping the business late last year before it announced its plan to acquire storage giant EMC. The deal is intended to make Dell more competitive in corporate technology against large rivals like Hewlett-Packard Enterprise and Oracle as well as specialists in cloud computing like Amazon and Microsoft.

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Narayan Ammachchi

News Editor for Nearshore Americas, Narayan Ammachchi is a career journalist with a decade of experience in politics and international business. He works out of his base in the Indian Silicon City of Bangalore.

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