Tuesday, December 16, 2008

Dell Trails Its Rivals in the Worst of Times - NYTimes.com

Hmm… I suspect this article will fuel speculation about about a possible Dell + EMC deal (a Cisco + Dell + EMC deal might make more sense)

Dell has $9 billion in cash, but a deflated share price, its unique culture and inexperience with absorbing a major acquisition raise serious questions about just how much change and breadth Dell can buy.

“It’s not a question of size,” said Brian T. Gladden, chief financial officer at Dell. “I think the question is more around diversifying our revenue base and becoming bigger in some things that are attractive for the long term.”

Dell executives point to any number of acquisition possibilities: servers and storage systems, software and services. “That is where we have to do an acquisition to become relevant,” Mr. Gladden said. “There is no question.”

Wall Street analysts speculate that Dell was gearing up to make the largest acquisition in company history. Dell spent close to $7 billion on share repurchases over the last year, while Mr. Dell has also spent his own money buying close to $200 million in Dell stock. With these gestures of confidence, Dell’s share price rose to more than $25 in late August from an eight-year low of $18.24 in April.

Dell Trails Its Rivals in the Worst of Times - NYTimes.com

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