UPDATED 22:42 EDT / SEPTEMBER 11 2016

NEWS

Report: Dell to lay off 2,000-3,000 employees after EMC deal

Dell Technologies Inc. is expected to lay-off between 2,000 and 3,000 workers following the completion of its blockbuster $67 billion EMC Corp. acquisition. But that number could climb even higher if the newly merged company’s sales don’t match expectations, Bloomberg is reporting.

Following the merger, Dell’s plan is to try to save up to $1.7 billion in costs over the next 18 months, but at the same time it also plans to increase sales by several times that figure to minimize the need to eliminate any more jobs.

“As is common with deals of this size, there will be some overlaps we will need to manage and where some employee reduction will occur,” a spokesperson for Dell told Bloomberg. “We will do everything possible to minimize the impact on jobs. We expect revenue gains will outweigh any cost savings, and revenue growth drives employment growth.”

Most of the redundancies are expected to hit workers in the U.S., with marketing, supply chain and general administrative workers likely to feel the brunt of the cuts. The news comes following the completion of Dell’s EMC Corp. acquisition last week, which created a corporate giant valued at over $70 billion with 140,000-plus employees.

The deal came as both companies are attempting to pivot in order to counter the threat of cloud computing rivals, and in Dell’s case, the dramatic slowdown of the personal computer market. EMC’s growth had basically flatlined before the deal, while Dell has been struggling for some time to become more than just a PC vendor. The newly combined entity will now focus on building hyper-converged and integrated platforms and serving as “arms dealers” to cloud providers, noted Wikibon analysts Dave Vellante and Stu Miniman during a recent discussion on theCUBE.

In order to pay for the acquisition, Dell has already sold off a bunch of its assets, including Perot Systems and also its software business, which comprises Quest Software, Sonic Wall and a few other assets.

Here’s Vellante’s and Miniman’s full discussion of the Dell-EMC deal and its prospects, along with a comparison to HPE’s deal last week to sell off most of its software assets:


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