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Hal Lilly, left, and Barb Lilly, center, look at Dell products with Paul Sigurdson, right, at a Mall in Frisco, Texas, in this Feb. 16, 2006 file photo. Dell Inc.'s net income fell 18 percent in the first quarter, missing already-reduced forecasts, as the world's largest PC maker struggled with fierce competition from rivals who have gained ground on the company's direct-sales model. In a related announcement, the company said it will begin using chips from Advanced Micro Devices Inc. for the first time. (AP Photo/Donna McWilliam, File)
AP Photo/Donna McWilliam
M&A alert.
KIND OF A BIG DEAL

Dell is reportedly in merger talks with EMC

By Alice Truong

Dell, the world’s third largest PC maker, and the cloud storage company EMC Corp. are in discussions about a potential merger, reports the Wall Street Journal, for what could be one of the biggest technology deals in history.

An agreement could be reached within a week, according to the New York Times. Of course, it’s also possible the talks won’t lead to any deal at all. It remains unclear if the two companies are discussing a full or partial takeover of EMC. Shares of EMC shot up 9% in after-hours trading Wednesday on the news.

EMC, based in Hopkinton, Massachusetts, has a market capitalization of $50 billion, and it owns the software-development company Pivotal and enterprise-security firm RSA, as well as 80% of the virtualization company VMware. Amid slowing revenue and a declining stock price, some investors have been calling for a breakup of its businesses. The hedge fund Elliott Management, which owns a 2% stake in EMC, has publicly pressured the company to spin off VMware.

EMC performed a strategic review last year to explore its options. In 2014, the company held talks with both Dell and Hewlett-Packard. The discussions with HP ended before the Palo Alto, California company announced it was splitting its printer and PC businesses.