On Monday, Dell Inc. announced that it selling its information technology services division to NTT Data Corp (TYO: 9613) for over $3 billion as part of its ongoing reorganization plan. Dell had purchased this business for $3.9 billion in 2009 when it was Perot Systems, founded by billionaire and onetime presidential candidate Ross Perot.
The sale comes as privately-held Dell prepares to buy data storage provider EMC for $67 billion and tries to reinvent itself as more than just a personal computer company. That deal was announced in October and was initially targeted to close in the second or third quarter of Dell's fiscal year ending Feb. 3, 2017.
Japan-based NTT Data focuses on information technology in the medical field, including medical records and billing. NTT Data said the acquisition would increase its presence in North America significantly, and strengthen and expand its global delivery network.
“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,” NTT Data CEO John McCain said, “Dell Services is a very well-run business and we believe its employee base, long-standing client relationships, and the mix of long-term and project-based work will enhance our portfolio.”
This acquisition would mark one of the largest foreign buyouts in receant years for NTT Data, operations of which span fixed-line and mobile telecommunications as well as IT services. Faced with sluggish growth at home, many Japanese companies are turning to overseas acquisitions.
According to data compiled by Bloomberg, NTT Data has been expanding rapidly, spending approximately $550 million, buying companies outside Japan since 2011. It has focused on services similar to those offered by Perot Systems, like handing digital medical records and billing systems for hospitals. NTT Data released the agreement with Dell in a filing with the Tokyo Stock Exchange, but the company didn’t say when it intended to complete the acquisition.