Summary
Dell announced it will spend $3.9 billion for Perot Systems.
Analysis
Dell''s purchase of Perot Systems allows them to change their business model and expand into the services space like HP has done. Perot has a strong position in healthcare and provides outsourced systems support to major hospitals such as Stanford's. This move enables Dell to also move into the eHealth records space which is expected to grow significantly in the coming years. The eHealth space is one that is to receive benefits from the Administrations stimulus program. Exactly how that is to take place is yet to be determined.
One the surface it seems like a bold move for Dell in that there a major differences between Dell's core business and Perot's. Exactly how synergies will be realized and cultures combined are critical matters to be addressed.
This author consults with leading institutions through GLG
Analyses are solely the work of the authors and have not been edited or endorsed by GLG.
