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NTT Data To Acquire Dell IT Services For $3 Billion: What's In It For The Japanese Company?

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Recent reports revealed that Dell was in the final stages of closing a deal to sell its IT services to NTT Data, a unit of Japanese telecommunications company NTT which sells cloud-based services, consulting, outsourcing and managed services. An official announcement regarding the agreement is expected to be made once the board of NTT Data approves the transaction.

The announcement has now been made, with NTT Data officially acquiring Dell Services for $3.06 billion.

"There are few acquisition targets in our market that provide this type of unique opportunity to increase our competitiveness and the depth of our market offerings," said NTT Data CEO John McCain, adding that the company is confident that the deal will prove to be a positive one not only for NTT Data but also for its shareholders, employees and clients.

The acquisition by NTT Data looks to boost the company's global presence in the IT services market, according to McCain. The move was made in response to the growing need of NTT Data's enterprise customers in Tokyo for more consistent cloud services, as worldwide expansions plans are being launched.

NTT Data's purchase of Dell Services also widens the company's business in North America, where NTT Data is expecting its annual revenue to grow from $1.7 billion to $5 billion and employee count to grow from 21,000 employees to 60,000 employees.

The completion of the transaction will also lead to a significant expansion of BPO capabilities for NTT Data and Dell Services, particularly within the insurance and healthcare sectors. The infrastructure platform will also see a definite improvement with NTT Data's 230 data centers around the world being joined by the data centers of Dell Services located in the United States, the United Kingdom and Australia.

As for Dell, the sale of Dell Services helps the company raise funds that would be needed in its planned acquisition of EMC, a data storage company. The merger would be one of the biggest tie-ups ever in the tech industry, with Dell looking to close the deal to acquire EMC instead of rival Hewlett Packard.

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