Are Elliott trying to single handedly destroy the IT industry?
How do you solve a problem like Elliott? EMC's got 3 weeks to figure it out
EMC has most of October to answer activist investor Elliott Management's demands for a shareholder value increase through a sell-off of VMware. According to an Elliott leak Reuters report, Elliott, with two directors on EMC's board, hopes the extra time after the expiration of the September standstill agreement will enable EMC …
COMMENTS
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Friday 2nd October 2015 13:29 GMT Mr.Nobody
He just needs more money, but it is impressive at how screwed up EMC is as a company. They actually seem ripe to be fiddled with (or broken up).
Not too many companies have competitive products in their portfolio like EMC does, and it makes one wonder how they can keep it going.
Management would normally pick the winner out of competing products and wind them down the losers. Customers could be persuaded and incentivized to move to the new platform.
Keeping up teams of support, dev, QA and the like for all those products gets very expensive and very cumbersome.
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Friday 2nd October 2015 16:16 GMT Anonymous Coward
myth
the EMC federation is a myth - individually, obviously, some excellent products, but equally some utter dross - with limited to zero integration advantages. This comes from the cutivated environment of fear and will-we-wont-we be next with out heads under the axe. I hope the bubble doesn't burst, but really what options?
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Friday 2nd October 2015 21:48 GMT Anonymous Coward
Emperors new clothes
I think the article is representative of the situation. Internally a lot of the troops know the federation concept does not work. The culture of EMC is not one of a co operative solution provider, it is quarterly driven product revenue operation with a do or be shot mentality...and Joe thinks they all have time to play nice...not at the coal face! That is the dilemma of a product centric organisation moving to a subscription services based model....likely to fail for many reasons imo.
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Monday 5th October 2015 08:49 GMT hoola
Parasites
Elliott, like all these "Active Investors" are out for one thing only, short term profit at any cost. They have no interest in what the companies do as longs as they can make money. If that means breaking successful companies up then they do not care. Unfortunately for the likes of EMC & Citrix they are completely stuffed. I struggle to see what these outfits actually do that benefits anyone.
You can be absolutely confident that the profits will be off-shore asap and will avoid any tax.
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Monday 5th October 2015 14:16 GMT Big Wiggle
I agree with Elliot that EMC should sell off it's VMware stock but it pisses me off that a minor stock holder has this sway when anyone can plainly see that they bought into the company just to suck cash out of it. Elliot is the epitome of a robber baron. They suck in all that money and produce jack shit.
I only hope that EMC ends up selling off their VMware stock and let's it become a fully independent company. I see no good coming out of other scenarios. If HP or another OEM gets their grubby mitts on VMware, it will only kill all other OEM support for the platform in the long term. I'm still trying to figure out why HP would want EMC for any reason other than to get a hold of VMware. I'm also trying to figure out how HP can make it happen since the soon to be split HPE will have a market cap of $24billion while VMware is $34billion. EMC itself has a market cap of $48billion.
Will everyone really agree to that big of a stock swap? Will Elliot really make the cash they hope to get if they did get EMC and HPE into a shotgun wedding? Meg Whitman has be incredibly gifted at destroying stockholder value over the last year. I'm speculating that Elliot would cash out immediately after any merger and then buy back in when Meg finally crashes the stock of the combined company so they can force another spin off.
Meanwhile Elliot keeps forcing Citrix's hand on the other side of the equation. Dell buying Citrix could force HPE to try and buy VMware.