EMC-Dell Merger To Make Hopkinton Business 'A Lot Larger,' Says CEO

HOPKINTON (CBS) – It's the largest deal of its kind in the high-tech field. Computer hardware company Dell, based in Texas, is acquiring Hopkinton-based data-storage company EMC for $67 billion.

What does it mean for jobs and the high-tech industry in Massachusetts, where EMC employs about 9,700 people?

"The businesses headquartered here is about to get a lot larger," Dell CEO Michael Dell told reporters in a conference call in Hopkinton Monday.

"We are planning to put our server business into the EMC enterprise data center business and so the businesses headquartered here will become a more than $30 billion business."

As a result, Dell believes the merger means Massachusetts will become "more important" in the industry, not less.

"Times are changing and you've really got to think in terms of technology hubs," said EMC CEO Joe Tucci, who was on the conference call with Dell. "This new combined company will have three great, major, major hubs in the U.S," he said, singling out the Boston area, Austin, Texas and the Silicon Valley in California.

"We're going to house the biggest business in the new company," Tucci said. "The systems business, the biggest business at EMC, here in Hopkinton and we anticipate that will start out life at over $30 billion."

"We're not actually going to move a whole lot of people around," Dell said.  "This will mean great things for this area."

However, when asked about the possibility of layoffs, neither Dell nor Tucci would answer the question directly.

A spokesperson for the Massachusetts Department of Labor told WBZ-TV they have not received any calls from Dell or EMC regarding layoffs. Under state law, they don't need to report any layoffs until 60 days after a large company layoff.

WBZ NewsRadio 1030's Lana Jones reports

Jeremy Burton, EMC's president for products and marketing, expects the merger to create more jobs on the sprawling Hopkinton campus and he said many current EMC employees would benefit from the deal.

"Employees that hold stock, which is a large proportion, I'd say are very happy. And then, obviously, we've got to see as the companies come together, there's going to be retention and compensation put on the table going forward," he told WBZ NewsRadio 1030.

Michael Dell said he has already spoken with Governor Charlie Baker about the merger, but he did not reveal details of the conversation.

"EMC has been an anchor of the Massachusetts technology economy for decades, and the administration is optimistic that the newly combined Dell-EMC enterprise systems unit will have a robust presence locally for years to come," Baker said in a statement.

The deal, which still needs to be approved by EMC shareholders, is expected to close by February 2017.

Jim Kingdon, a high-tech employee for 30 years, fears a buyout of EMC would likely mean layoffs for the Massachusetts company.

"I think when you merge two companies together, you have redundancy," he says. "When you have redundancy, people are going to end up losing their jobs."

EMC laid off 1,500 workers in the first quarter of this year and it let go 1,000 people in 2014.

Job losses, even massive cuts, in Hopkinton wouldn't necessarily make a dent in the local economy.

"It's not all that concerning from our standpoint," Hopkinton Selectman Ben Palleiko told WBZ-TV's Bill Shields. "As wonderful as they have been, from a tax-basis perspective, they're only about 5 percent of the tax base."