Executives from EMC are continuing their efforts to reassure investors, customers, employees and the industry that Dell's $67 billion bid to buy the storage giant and its various companies is in the best interests of everyone involved.
Most recently, EMC CEO Joe Tucci and Bill Green, the company's lead independent board member, took to the stage at the Goldman Sachs Technology and Internet Conference 2016 in San Francisco this week to say that the complex deal is still on track to close later this year, that the two companies are a natural fit and that shareholders—particularly those of virtualization company VMware—will benefit from the merger.
Green told attendees that the deal will close on time "unless an act of God happens," according to a report in Forbes.
This came at around the same time that an EMC filing with the Securities and Exchange Commission (SEC) included part of a post that Howard Elias, president and COO of EMC's global enterprise services business, put on the company's intranet for employees in which he noted that recent outside analyses of the deal found that not only would current EMC and Dell customers be apt to buy more products from a combined company, but that non-customers also were interested in dealing with the larger company.
It also followed comments that Tucci and other company executives made Jan. 27 during a conference call to discuss the latest quarterly financial numbers that touted the benefits of the acquisition, which would be the largest deal in the history of the tech industry.
"Our combined assets are better positioned to navigate the major changes in our industry and lead in the new world," Tucci said. "Customers have been overwhelmingly positive about this combination. … And very importantly, the people of the EMC and Dell are embracing the combination. They understand that together, we are better positioned in the market and that this will create new and more opportunities for them over the long run."
There have been concerns about possible obstacles to the deal since Michael Dell and Tucci first announced it in October 2015, from the massive debt Dell will have to take on (as much as $49 billion) and shareholder pushback to the drop in share prices of EMC and VMware and the future of the virtualization company—which late last month announced 800 layoffs—once the deal closes. There also are reports of several shareholder lawsuits aimed at spiking the deal.
Some of the worries are around the "tracking stock" allocated to VMware shareholders, a move that is designed to help Dell finance the deal and make it more attractive to investors. Over the past few months, the tracking stock's value has fallen farther than EMC's. In addition, there are concerns that once the deal is done, Dell officials will use VMware's cash to pay down debt.
Both Michael Dell and Tucci have tried to assuage concerns over VMware, of which EMC currently owns more than 80 percent. The Dell CEO in a blog post in October called VMware "a crown jewel of the EMC federation" and that he intends "for VMware to remain an independent public company."
Tucci has said several times that he's heard the concerns and that he is confident Dell will not raid VMware's coffers. During the earnings call, he said that both he and Michael Dell are "incredibly excited by the prospects for this great company [VMware] and I firmly believe that Mike will be an outstanding steward for this franchise."