EMC To Acquire Rival Data General
HOPKINTON, Mass. (AP) _ EMC Corp., the No. 1 maker of storage systems for big business computers, agreed to buy rival Data General Corp. in a $954 million deal that will help EMC expand its range of technology products.
EMC makes memory disks and storage software for mainframe computers used by large companies to process massive quantities of information. Data General specializes in storage systems for ``server″ computers that run networks of smaller machines.
``This acquisition delivers on our long stated objective of constantly expanding our market opportunities,″ EMC chief executive Michael Ruettgers said in a statement.
EMC said today it will issue 0.3262 of a share of EMC common stock for each share of Data General common stock. The transaction is worth about $954 million based on EMC’s midday stock price of $56.93 3/4, which was down 5 percent, or $3.06 1/4 a share in trading today on the New York Stock Exchange.
Data General stock was up 31 percent, or $4.12 1/2 a share at $17.31 1/4.
EMC previously had no presence in the fast-growing midrange storage market, valued at $10 billion last year.
Data General’s server business will operate as a separate unit of EMC after the acquisition.
The acquisition accelerates EMC’s progress toward a goal of $10 billion in revenues by 2001. Last year, EMC reported about $4 billion in revenues, while Data General reported $1.5 billion.
The Westboro-based Data General, founded in 1968, has a workforce of about 5,000. EMC employs 11,200 worldwide. An EMC spokesman did not say if any jobs would be lost in the acquisition.