TOKYO (BLOOMBERG) - Nippon Telegraph & Telephone Corp., the former telephone monopoly in Japan, agreed to buy technology services businesses from Dell for US$3.055 billion (S$4.1 billion) as the company seeks to expand overseas to counter an aging domestic market.
The acquisition through unit NTT Data Corp. are to strengthen the footprint in North America, and enhance cloud service and business-process outsourcing, or BPO service, according to a statement to the Tokyo Stock Exchange. The company will hire the 28,000 employees located mainly in North America and India from Dell. No date for the takeover was provided.
The acquisition would be NTT Data's largest, helping increase its sales outside Japan, where a shrinking and aging population has stymied economic growth. Dell, which paid US$3.9 billion for what was formerly known as Perot Services in 2009, is selling some assets before completing a record deal - the US$67 billion takeover of software and storage systems provider EMC Corp.
The transaction is subject to customary closing conditions and regulatory approvals, the two companies said in a joint statement.
"With this acquisition, we look forward to raising our presence in the U.S., in the largest IT-service market," Kazuhiro Nishihata, director in charge of global business at NTT Data, told reporters in Tokyo Monday.
The company hasn't decided how to fund the purchase, Nishihata said. Debt and equity options are being considered.
Wells Fargo & Co. was the lead financial adviser to NTT Data, which was also assisted by JPMorgan Chase & Co. and Credit Suisse Group AG, according to the joint statement by the two companies. Citigroup Inc. was the lead financial adviser to Dell, it said.
Dell plans to sell the division as part of a wider effort to raise as much as US$10 billion from the disposal of assets that aren't core to its business, Re/code reported earlier.