Dell Negotiating to Buy Quest Software, PacketTrap?

Dell Negotiating to Buy Quest Software, PacketTrap?

Dell (NASDAQ:DELL) is in discussions to acquire Quest Software Inc., promoter of PacketTrap managed services software. Sources tell MSPmentor that Dell's potential buyout of Quest has not been finalized and there's still a chance a Dell-Quest deal may not happen.

Chatter about Dell's potential buyout of Quest Software surfaced yesterday from BloombergBusinessWeek. Although no deal has been announced, Dell's interest in Quest Software is easily explained.

Quest Software's Focus

Quest Software offers a range of IT management, data management, security, virtualization and managed services software. Quest Software also has extensive expertise migrating on-premises customers to new versions of Microsoft applications, and to cloud versions of Microsoft's offerings -- including Office 365.

Quest Software has been transitioning from a publicly held company to a privately held company. Quest Software, represented by Morgan Stanley, has also pursued buyers for the company as part of a 60-day "go shop" effort. Even if Dell doesn't emerge as Quest Software's buyer, it's clear that Quest Software has been considering multiple offers for the company.

For managed services providers, a potential Dell-Quest Software deal would definitely trigger chatter about Quest's PacketTrap business. The PacketTrap MSP and PacketTrap PSA solutions are positioned for managed services providers (MSPs) that want to remotely manage customer networks while automating internal MSP operations. While Dell has improving relationships with many MSPs, a potential Dell-Quest deal is likely to trigger a range of reactions from MSPs -- some of which likely would not want their PacketTrap customer data moved into Dell-owned clouds.

But again, I'm getting ahead of myself: No deal has been announced. If a deal does surface, we'll be sure to ask how the PacketTrap business will be managed.

Dell Mergers and Acquisitions

Dell, meanwhile, has been busy buying up networking, security, storage and software companies in a quest to push beyond PC sales. Dell's latest financial results disappointed Wall Street, but Dell's purchases EqualLogic and Compellent, have performed well. Dell has also made some moves in the managed services market over the years, but buyouts like Silverback Technologies never really caught on with next-generation  MSPs.

Dell's merger and acquisition strategy, however, has triggered some concern in the IT channel. Dell's recent buyout of SonicWall sent some security channel partners looking for alternative vendor relationships. Some of those SonicWall channel partners attended last week's Sophos partner summit, where Astaro unified threat management (UTM) solutions attracted strong interest from some SonicWall partners.

Dell declined to comment to BloombergBusinessWeek. A Quest Software spokeswoman told MSPmentor the company had no comment about the speculation.

TAGS: Financing PSA RMM
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