So Dell and storage array vendor Compellent have all but tied the knot, pending agreement form Compellent's shareholders which, while not a done deal, looks highly likely.
There's an interesting analysis of the deal here, which points out that Dell acquired Compellent for considerably less than it would have paid for 3PAR, for which it lost a bidding war against HP in September.
From Dell's point of view, this is a bit of a win. HP paid US$2.35 billion for 3PAR while Dell looks set to pay just US$960 million for Compellent. And that's despite a media offensive that Compellent undertook last month which was, we can now see with hindsight, designed to help boost its visibility and thus its sale price.
The cynical among us might imagine that Dell's strategy all along was to force HP to pay more, while keeping the Compellent deal in its back pocket all along.
I'm not convinced that I'd subscribe to that view: the cock-up, rather than conspiracy, theory of history tends to fit the facts better most of the time. HP's pockets are deep so the US$2.35 billion it paid for 3PAR, while not quite pocket change, doesn't amount to a crippling dent in the company's finances: it netted more than that amount during its last declared quarter at the end of October and still hoards almost US$11 billion in cash.
It could all have gone wrong too: Dell might have had to pony up for 3PAR which, although it had a much higher media profile, probably wasn't worth well over twice as much: Dell paid six times Compellent's annual revenues, HP paid 12 times 3PAR's equivalent figure.
Where does the deal leave Dell? It's been conventional wisdom over recent years that Dell wants to be shot of its relationship with EMC where it is effectively a reseller of the storage giant's gear. Dell, if it's to match HP and Cisco in the datacentre and be seen as a serious player in the burgeoning cloud computing market, needs to be able to sell its own offerings, not a third-party product set for which it has to pay royalties.
Now it can: with the Compellent deal it has the mid-range Fibre Channel SAN market covered, while it's been able to cover off the lower-end iSCSI market with its EqualLogic range (acquired for US$1.4 billion in 2008).
Like HP, when it comes to storage, Dell has arguably been weakest in the NAS market, so the M&A activity may not be over...