Dell Agrees to Buy Server-Software Maker Scalent Systems in Shift From PCs

Dell Inc. agreed to buy Scalent Systems Inc., a maker of software for managing server computers, as the world’s third-largest PC maker pushes to expand sales of data-center products.

The purchase of Palo Alto, California-based Scalent is expected to close during the fiscal quarter that ends this month, Dell said in a statement today. The companies didn’t disclose financial terms.

Dell is seeking to compete with companies such as International Business Machines Corp. and Hewlett-Packard Co. in the market for more complex computer systems and technology services that yield higher profits than desktop and laptop PCs.

Chief Executive Officer Michael Dell told analysts at a meeting in Austin, Texas, last week that Dell plans to almost double the size of its enterprise computing business to $30 billion by fiscal 2014 from $16 billion last year, in part through acquisitions.

“We haven’t ruled out any category” of companies to buy, he said.

Dell said on June 23 that it expects revenue to rise as much as 19 percent this fiscal year, which would bring it to $62.9 billion. The Round Rock, Texas-based company’s sales fell 13 percent last fiscal year, which ended in January.

Scalent is closely held and makes software that lets companies’ information technology departments load new software onto server computers and allocate additional servers, storage devices and networking gear to run applications.

Dell already sells Scalent’s software under its Advanced Infrastructure Manager brand. Scalent’s roughly 40 employees will be retained and more salespeople will be hired for its products, said Donna Troy, Dell’s vice president of solutions marketing and sales.

To contact the reporter on this story: Aaron Ricadela in San Francisco at aricadela@bloomberg.net

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