Computing giant Dell is nearing the end of the process to sell its Perot Systems IT outsourcing services unit in a deal that is expected to exceed $4 billion, sources briefed on the process told Re/code.
France’s Atos Nears $4 Billion Deal to Buy Dell’s Perot Systems Unit
India’s Tata Consultancy Services re-engaged in talks last week, but walked away again today.
Justin Sullivan / Getty
Atos, a French IT outsourcing firm with offices in Purchase, N.Y., and Arlington, Texas, is the leading bidder and has offered between $4.2 billion and $4.3 billion for Perot, sources said.
Tata Consultancy Services, the technology consulting and services arm of India’s Tata Group, the 147-year-old industrial conglomerate, re-engaged Dell in talks late last week and may have made an offer, but walked away from the table today, sources said. TCS ended an earlier round of talks with Dell to buy Perot in mid-December. Dell had hoped to sell the unit for closer to $5 billion.
Two other companies approached by Dell as part of the sale process — New Jersey-based Cognizant Technology Solutions and Japan’s NTT Data — are said to be out of the running. Sources said the situation remains fluid and could still change.
Dell first started shopping the business late last year, before it announced its plan to acquire storage giant EMC. Proceeds from the sale could help Dell pay down some of the $50 billion in debt it has proposed to raise to buy out EMC. Dell and its co-owner, the private equity firm Silver Lake, offered a combination of cash and tracking shares to buy out EMC in a deal valued at $67 billion when it was announced on Oct. 12.
Sources say Dell is hoping to raise as much as $10 billion from the sale of assets it considers no longer core to its business. Among the other assets on the table for a possible sale is Quest Software, which it acquired in 2012. It also filed to take its computer security subsidiary, SecureWorks, public in an IPO later this year.
Perot Systems started as an IT services company founded by the billionaire and onetime U.S. presidential candidate Ross Perot. It handles a lot of technology needs for government agencies and health-care providers, including helping to process medical claims. Dell acquired it in 2009 for $3.9 billion.
Dell representatives declined to comment, while TCS replied that it does not comment on market speculation. A spokesperson for Atos didn’t immediately return messages seeking comment.
This article originally appeared on Recode.net.
See More:
