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NTT Data to buy Dell's IT Services for $3 billion

In an effort to help expand its business outside of Japan, NTT Data Corp. has just agreed to buy Dell Inc's IT services businesses for $3.06 billion. The deal would be the largest to date for the company and would allow it to easily break into the U.S. Market.

Dell is currently in the process of finalizing a $67 billion deal with EMC Corp. and is attempting to sell off some of its assets. In 2009, the company acquired Perot Systems for $3.9 billion and planned to expand its reach in the data services market. As it stands today, much of Dell Services is made up of Perot Systems including many contracts for the Defence Department and IT services in U.S. healthcare.

The connections and clients that Perot Systems has in the U.S. healthcare industry will allow NTT Data an easy way to increase its presence outside of Japan where economic growth has slowed down in recent years. The company is well-known and has influence within its own country but it is not yet popular enough globally to win competitive contracts in health care.

NTT Data was originally started as part of Nippon Telegraph & Telephone Corporation which had a monopoly on the telephone market in Japan. Since 2011 the company has spent 72 billion yen buying up companies, many of which were located abroad. Last year NTT Data's overseas sales roes to 450 billion yen which is more than double what they were in 2012.

The purchase of Dell's IT services will greatly help the company increase its footprint in North America. As part of the deal, NTT Data will hire 28,000 of Dell's employees located in North America and India.

Hundreds of hospitals and thousands of health care facilities in the U.S. are already using NTT Data's services and this will likely increase as the company expands and becomes more well-known in North America.

Image source: Shutterstock/Kritchanut

Anthony Spadafora
After living and working in South Korea for seven years, Anthony now resides in Houston, Texas where he writes about a variety of technology topics for ITProPortal.