The rumours surrounding a mega tech merger between Dell and EMC has thrown up question marks over the future operations of both businesses in Ireland, with thousands employed across numerous sites.
The deal seems to be tied to a belief that EMC-owned VMware may spin off into its own operation, which means that around 6,000 employees (3,000 at EMC, 2,300 at Dell and 700 at VMware) are wondering where their futures lie.
Any potential merger would help Dell position itself as the primary operator among corporate clients, with EMC’s expertise across both digital storage and enterprise security operations clearly appealing to the world’s third-largest PC maker.
Were VMware to remain as part of the full merge, its cloud computing expertise would strengthen a potential Dell-EMC combination even further.
Of course, PC making may not be a long-term viable strategy, as more and more people move towards mobile and portable options.
With that, Dell has spent some time now eyeing up ways to shift its focus towards a more rounded, complete provider of computing services to the enterprise world.
This is basically a way to adopt an approach similar to HP which, ironically, is another company that EMC was reported to be negotiating a merger with in the recent past.
With regards Irish employment concerns, Cork will receive the brunt of the worry. EMC’s ‘Centre of Excellence’, which oversees research and training, takes up the vast majority of its Irish employees, with VMware’s 700-strong workforce in Cork, too.
The merger rumours come as reports mount that EMC investor Elliott Management is putting pressure on the company to take the jump and split up its operations, making it more appealing to a buy-out.
According to Daniel Ives, senior technology analyst at FBR Capital Markets, VMware spinning off is a must for EMC.
If it fails to act before its next financials are released later this month, things could get messy, he said on CNBC.
“That house has been burning for a few years, and they’re worried about if they have napkins in the kitchen,” he said. “Now, finally, backs are against the wall, and there’s an ultimatum that they need to do something.”
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