UPDATED 10:11 EST / DECEMBER 15 2010

Dell is Unstoppable, Craves More Storage Center Deals after Compellent

Following the $960 million Compellent acquisition deal, Dell is dead serious in getting back in the game with more plans of expansion of its storage and data centers. In less than 7 days, Dell is again up and at the surface looking for more purchases to strengthen itself against rivals like HP and EMC.

Dells’ executive Vice President Brad Anderson revealed their vision and plans to seek prospect purchases in software and managing data storage systems. He briefly said, “The storage area will continue to be a very attractive area for us.  In the meantime, Round Rock, Texas- based Dell plans to keep reselling EMC’s products.”

The similar report also discussed terms and conditions about the Compellent deal: “Dell will pay Compellent investors $27.75 a share in cash, the companies said today in a statement, after announcing last week that they were in exclusive talks for a price of $27.50 a share. The purchase price is 3.3 percent less than the Dec. 10 closing price for Compellent. The stock had gained 68 percent in the past two months on speculation the company would get bought.”

This year also marks the big players’ spur of interest in storage market. HP, EMC, IBM, Cisco and Oracle are looking into beefing up their internal storage systems as a market strategy. It was evident in acquisitions here and there. Before Dell could even consider buying Compellent Technologies, it placed a hefty bid for 3Par Inc. Unfortunately, it was no match to HP’s $2.35 billion offer.

However, analysts think that Compellent is a blessing in disguise and is quite great for a consolation prize. It is important to note that Dell’s sales last quarter was fairly good and thanks to storage products that contributed $15.4 billion or 3.5% share in sales. From a market standpoint, Dell sees an opportunity through Compellent to increase its current roughly 9% of the storage systems market to perhaps as much as 12%, placing the company in a number two or three position behind EMC.

Senior Analayst David Floyer of Wikibon has dropped great comments on Compellent’s technology. He said, “What’s unique about Compellent is the simplification and automation of storage so that no storage specialist is required.” In an earlier report, Floyer also noted that he was able to speak to some clients of Compellent and these people has nothing but praises spurred by outstanding customer service and satisfaction.


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