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EMC is letting go of its Documentum division

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April 7, 2016

According to a few reports, it looks like EMCís Documentum division may be up for sale, as part of a non-core asset divesting process during the Dell-EMC merger some months ago.

To be sure, Bloomberg is citing people familiar with the matter in a report claiming that EMC will spin off Documentum while Dell will sell SonicWall and Quest as a way of helping to lower the costs of the Dell-EMC merger.

Itís also anticipated that Dell will take on up to $50 billion of debt to pay for EMC.

As for Dellís IT services business, it was sold to NTT Data Corporation in March for $3 billion.

EMC acquired Documentum for $1.7 billion in October 2003, shortly after acquiring Legato, for its document management product and as part of a move to add storage-related software to its hardware sales.

Eventually, Documentum ended up in EMCís Information Intelligence Group (IIG). The firm spent years selling Documentum products as traditional software with a licence, but failed to set the document management world on fire, leading to repeated suggestions it should be hived off or simply sold.

Worse, the document or information management business simply stopped growing at one point. Certainly businesses needed to keep track of documents and doing so as part of an information lifecycle management process seemed a good idea at that time, but it was a structure that never became really popular.

People generally preferred to manage a businessí digital information in separate silos, such as mail, notes, databases and the like, rather than employing an over-arching superstructure.

Consequently, IIG as a business has never grown as EMC might have hoped, generally disappointing quarter after quarter with falling revenues.

EMC then placed its Information Intelligence Group into an Enterprise Content Division in January 2015 and also tried selling Documentum functionality as a service.

Itís also reported that the Documentum business turns about $600 million annually and has a 30 percent profit margin. Private equity is said to be the likeliest buyer.

Source: Samsung.

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