Dell agrees to buy Perot Systems for $3.9B

Dell has agreed to buy Perot Systems for around US$3.9 billion in cash, and intends to make the company its global services delivery division, the companies said Monday.

The deal will allow Dell to expand its range of IT services, and potentially allow it to sell more hardware to existing Perot customers, it said.

Dell's rival Hewlett-Packard expanded its own global services unit with the acquisition of EDS for $13.9 billion in May 2008.

Over the last four quarters, Dell and Perot together had revenue of $16 billion from enterprise hardware and IT services, with $8 billion coming from enhanced services and support, Dell said.

Perot's contribution to that is relatively small: In 2008, the company reported total revenue of $2.78 billion.

At $30 per Perot Systems share, Dell's offer represented a significant premium over Friday's closing price of $17.91. In after-hours trading, the stock traded at $29.70 early on Monday morning.

The boards of Dell and Perot agreed the terms of the transaction on Sunday, they said. Dell expects to complete the deal in its November-to-January fiscal quarter.

Upon completion of the acquisition, Dell plans to make Perot Systems its services unit, and will put current Perot CEO Peter Altabef in charge of it.

It also expects Ross Perot Jr., chairman of the Perot Systems board, to be invited to join the Dell board of directors.

The services unit will fit alongside Dell's existing divisions for selling to large enterprises, to government customers and to small and medium-size businesses.

Dell created the three divisions in a major reorganization of its business sales teams last December, shifting from a geographic structure to one aligned with customer types.