<ul><li><keyword id="6390344" type="UNKNOWN" weightage="20" keywordseo="CISCO">Cisco</keyword> customers can avail of a 90-day payment holiday and deferment of 95% of the cost of new products till 2021. </li><li>The programme includes all Cisco solutions, including hardware, software and services. </li><li>In March, Cisco donated $225 million towards global relief efforts against Covid-19. The tech firm also gave away IT equipment from its offices to hospitals and governments. </li></ul>Cisco announced a $2.5 billion financing programme that allows its customers and partners to defer up to 95% of the cost of new products till 2021. The program is geared towards customers and partners buying hardware, software as well as services. In March, Cisco <a href="https://www.businessinsider.in/tech/enterprise/news/the-ceo-of-cisco-explains-why-the-tech-giant-is-committing-225-million-to-fight-covid-19-business-must-step-up-and-the-government-must-move-more-quickly/articleshow/74765800.cms">donated $225 million</a> towards global relief efforts against Covid-19. “The new Business Resiliency Program offered by <a href="http://www.cisco.com/go/financing">Cisco Capital</a> includes an up-front 90-day payment holiday and allows a customer to defer 95% of the cost of a new product or solution until 2021, which in turn protects their business and increases their existing cash flow,” said Cisco in a statement. From January 2021, customers who opt for this programme would make monthly payments based on the amount of financing and the financing term remaining. “Cisco's customers and partners are under enormous pressure to keep their businesses connected while remaining productive and secure," said Chuck Robbins, Chairman and CEO of Cisco. Robbins also <a href="https://www.bloomberg.com/news/articles/2020-04-08/cisco-ceo-tells-staff-jobs-are-safe-urges-others-to-avoid-cuts">called on</a> other large companies to contribute towards the fight against Covid-19 by holding off on job cuts. “To me, it’s just silly for those of us who have the financial wherewithal to absorb this, for us to add to the problem. It’s illogical,” he said in an <a href="https://www.bloomberg.com/news/articles/2020-04-08/cisco-ceo-tells-staff-jobs-are-safe-urges-others-to-avoid-cuts">interview</a>. According to its 2019 annual report, the California-based company currently has 75,900 employees on its rolls. Cisco’s financing program will help customers to invest in its products The Covid-19 pandemic forced companies to ask their employees to work from home. To facilitate this, they have had to invest in business conferencing solutions. As a result, Cisco has seen an increase in demand for Webex, its popular video conferencing solution. According to Cisco's latest financial reports, it has cash and cash equivalents of $27 billion. Cisco is betting on financial recovery post Covid-19 to help its customers in the present. As Cisco is digging into its healthy balance sheet to help customers continue to invest in its solutions, the customers get a line of credit to help them tide over the Covid-19 crisis and ease the new normal of social distancing while keeping up with productivity. See also: <a href="https://www.businessinsider.in/tech/enterprise/news/heres-a-big-list-of-free-tech-from-companies-like-microsoft-google-and-cisco-to-help-companies-deal-with-remote-work-amid-the-coronavirus-crisis/articleshow/74797239.cms">Here's a big list of free tech from companies like Microsoft, Google, and Cisco to help companies deal with remote work amid the coronavirus crisis</a> <a href="https://www.businessinsider.in/tech/enterprise/news/microsoft-and-cisco-throw-elbows-at-zoom-as-the-wildly-popular-video-app-struggles-with-security-flaws/articleshow/75018759.cms">Microsoft and Cisco throw elbows at Zoom as the wildly popular video app struggles with security flaws</a> <a href="https://www.businessinsider.com/how-cisco-is-supplying-hospitals-with-video-conferencing-tools-2020-4?IR=T">Cisco's response to the coronavirus reveals how the pandemic is turbo-charging innovation - from donating video-conferencing units to healthcare systems to manufacturing hundreds of face shields daily via 3D printing</a>

Cisco announces $2.5 billion financing programme for its customers and partners

<ul><li><keyword id="10862" type="CITY" weightage="20" keywordseo="Wipro">Wipro</keyword>’s quarterly net profits have dipped by 5.3% to $304 million.</li><li>Coronavirus took away $14-16 million from IT services revenue.</li><li>Jatin Dalal, Wipro’s chief financial officer, explained that the company won’t be releasing any guidance for the coming quarter in view of the global volatility.</li></ul> The pressure of the pandemic has started to reflect in fourth-quarter earnings of IT giant Wipro. Its net profits dipped by 5.3% to $304 million from ₹321 million in the last quarter. “We estimate that the IT Services revenues for the quarter ended March 31, 2020 were negatively impacted by COVID-19 by approximately $14 -$16 million,” said the company in a statement. Its dollar revenues, however, marginally increased by 1.6% to $2.05 billion from $2.02 billion from the third quarter. However, revenue from its IT services fell by 1% to $2.07 billion in Q4 2020. The operating margin for IT services also took a hit falling by 0.8% as compared to last quarter. Last quarter, <a href="https://www.businessinsider.in/business/corporates/news/wipros-profits-and-margins-fall-even-as-its-digital-business-grows/articleshow/73249220.cms">most of its growth </a>came from banking, financial services and insurance (BFSI), accounting for nearly one-third of IT services. In light of the uncertainty in the market and the volatility in global markets, Wipro decided not to provide guidance for the coming quarter. But they remain confident that once things get back to normal, the company will be able to recuperate its losses. “We are confident that our broad portfolio of services and our ability to execute our commitments makes us well-positioned to gain market share,” said Abidali Z Neemuchwala, the CEO and managing director of Wipro. In the last quarter, it won four deals in IT services, including one with the largest Spanish language media companies and another with a large US-based healthcare company. “The quarters ahead seem challenging and require a tremendous response on costs,” said Jatin Dalal, the chief financial officer. See also: <a href="https://www.businessinsider.in/business/startups/news/renuka-ramnath-becomes-the-first-female-chairperson-of-indias-venture-capital-association/articleshow/75161039.cms">Renuka Ramnath becomes the first female chairperson of India’s venture capital association</a> <a href="https://www.businessinsider.in/tech/enterprise/news/cisco-announces-2-5-billion-financing-programme-for-its-customers-and-partners/articleshow/75157885.cms">Cisco announces $2.5 billion financing programme for its customers and partners</a> <a href="https://www.businessinsider.in/policy/economy/news/indian-billionaires-and-narendra-modi-must-protect-jobs-like-the-us-during-coronavirus-lockdowns/articleshow/75156295.cms">Don’t layoff during lockdown— India needs a ‘jobs protection programme’ like US and the billionaires must lead while the government helps</a>

Wipro takes $14-16 million Covid-19 hit in Q4 skipping guidance and increments

<ul><li>Free cash flows put companies in a better position to weather the current market conditions.</li><li><keyword id="6361649" type="UNKNOWN" weightage="20" keywordseo="Goldman-Sachs">Goldman Sachs</keyword> report shows 12 companies which are expected to give an FCF Yield of at least 5% by March 2021. The average FCF Yield stands at 7.8%.</li><li>Companies in the Utilities and Oil refining sectors are expected to offer the best yields at an average of 14.5% and 7.5% respectively.</li></ul>The Coronavirus crisis has destroyed economies and wiped out years of savings. In times like these, for both companies as well as individuals, cash in hand allows you to continue your operations and incur costs without having to borrow money which has its own cost (interest). “We think in the current challenging environment, markets are likely to reward companies that are generating high Free Cash Flows and thus could manage their debt (deleveraging) and other obligations, including dividend pay-outs,” notes Goldman Sachs in its latest report. What is Free Cash Flow? Free Cash Flow (FCF) is the cash that a company is able to generate after meeting its operational and fixed costs. When a company’s Free Cash Flow is positive, it means that it is able to generate more cash than what is required to run its business. When the Free Cash Flow is negative, it means that the company is spending more money than it is generating. In simpler words, if your monthly income is ₹10,000 but your expenses are only ₹6,000, your Free Cash Flow is ₹4,000. However, if your expenses exceed ₹10,000, then your Free Cash Flow is negative. What is FCF Yield? Free Cash Flow Yield measures the free cash flow per share with the market value per share. For example, if a company has Free Cash Flow of ₹50 per share and the market value per share is ₹500, then the FCF Yield is 10%. Generally – and especially in these times, higher the FCF Yield is, the better it is from an investor’s point of view. Goldman Sachs expects these 12 stocks to have a Free Cash Flow yield of over 5% by March 2021 <table style="border-width: initial; border-style: none;"><colgroup></colgroup><col /><col /><col /><col /><tbody><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 1pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">Company </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 1pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">FY21 FCF Yield </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 1pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">FY21 EPS Growth Estimate </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 1pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">Last 1 Month Return </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 1pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">Reliance Industries </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 1pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">7.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 1pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">20.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 1pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">15.00% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">Infosys </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">6.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">1.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">6.98% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">Bharti Airtel </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">7.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">Not measured </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">7.67% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">ITC </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">6.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">6.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">26.55% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">Power Grid </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">11.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">8.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">3.45% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">Bharat Petroleum </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">8.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">130.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">-2.54% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">Tech Mahindra </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">9.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">-4.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">-14.21% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">Eicher Motors </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">6.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">9.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">-18.93% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">Larsen &amp; Toubro Infotech </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">5.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">-1.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">-3.89% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">Aurobindo Pharma </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">5.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">10.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">34.51% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">Apollo Hospitals </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">5.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">18.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;background-color:#d9d9d9;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">-3.35% </td></tr><tr><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">Tata Power </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">18.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">19.00% </td><td style="border-left:solid #000000 0.5pt;border-right:solid #000000 0.5pt;border-bottom:solid #000000 0.5pt;border-top:solid #000000 0.5pt;vertical-align:bottom;padding:0pt 5.75pt 0pt 5.75pt;overflow:hidden;overflow-wrap:break-word;">-14.22% </td></tr></tbody></table> Source: FactSet, Goldman Sachs Global Investment Research, NSE See also: <a href="https://www.businessinsider.in/business/telecom/news/if-vodafone-idea-increases-tariff-it-will-help-airtel-and-reliance-jio/articleshow/74964136.cms">A new research report says Vodafone Idea has to increase tariff by 39% to survive – and that will be a bounty for Reliance Jio and Airtel</a> <a href="https://www.businessinsider.in/india/news/how-to-save-money-if-your-salary-is-reduced-during-the-coronavirus-crisis/articleshow/74968040.cms">How to save money if your salary is reduced during the Coronavirus crisis</a> <a href="https://www.businessinsider.in/stock-market/markets/news/goldman-sach-bought-indusind-shares-after-the-stock-price-nearly-doubled-in-13-trading-sessions/articleshow/75176481.cms">Goldman Sachs bought IndusInd shares after the stock price nearly doubled in 13 trading sessions</a> <a href="https://www.businessinsider.in/tech/enterprise/news/cisco-announces-2-5-billion-financing-programme-for-its-customers-and-partners/articleshow/75157885.cms">Cisco announces $2.5 billion financing programme for its customers and partners</a>

Goldman Sachs says buy these 12 Indian stocks who have enough cash flow to thrive despite the Covid-19 crash

<div class="KonaFilter image-container display-table"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/5d9bad2f49e03f3dd37be175-1667/att campaign 2x1.png" border="0" alt="att campaign 2x1" data-mce-source="Reuters/Steve Marcus; Elliott Management; AP Photo/Richard Drew; Ruobing Su/Business Insider" />Reuters/Steve Marcus; Elliott Management; AP Photo/Richard Drew; Ruobing Su/Business InsiderJesse Cohn, center, is the righthand man for Paul Singer, on the right. He's brought a campaign against Randall Stephenson's AT&amp;T.</div></div></div><ul class="summary-list"><li>The latest campaign for Wall Street hedge fund Elliott Management is a big one, taking on well-known American staple AT&amp;T. The man in charge of pushing the massive company to make the changes the $38 billion fund sees fit is 39-year-old Jesse Cohn, billionaire Paul Singer's right-hand man. </li><li>Other than Singer himself, Cohn is the person most responsible for the transformation of Elliott from a distressed situations specialist to the sprawling, institutional behemoth it is today, with a separate private equity arm and billions ready to be deployed for a new activist campaign. </li><li>Cohn's tactics have ranged from shrewd to aggressive in the 100-plus campaigns the Long Island native has run for Singer.</li><li>Business Insider talked to more than two dozen of his colleagues, competitors, detractors, and friends, who said Elliott's rise mimics Cohn's own personal rise in the firm and in corporate America.</li><li>Sources tell Business Insider that Cohn, and Elliott's activism as a whole, are transforming as the firm positions itself as a long-term investor.</li><li><a href="https://www.businessinsider.com/prime">Click here for more BI Prime stories.</a></li></ul>Jesse Cohn has been behind some of the ugliest shareholder tussles and boardroom battles in history during his 15 years at Paul Singer's Elliott Management. His strategy of purchasing stock en masse and then demanding an overhaul of a company's business has provoked f-bombs from Detroit businessman Peter Karmanos and paranoia from AthenaHealth founder Jonathan Bush - the cousin of George W. Bush - that Cohn had him followed and photographed.Now, the 39-year-old - who is hooked on HBO's Succession - is setting his sights on his biggest target yet: telecom giant AT&amp;T.Those who have worked on the other side of some of his 100-plus campaigns at Elliott say his track record should strike terror in the hearts of AT&amp;T management, pointing to an uncanny ability to effect change at companies, including layoffs, cost-cutting, and the ouster of CEOs."I wouldn't want to be [AT&amp;T management]," said one long-time adviser to companies' boards of directors. In early September, Cohn sent 23 pages to AT&amp;T's board of directors, criticizing everything from the company's failed attempt to acquire T-Mobile in 2011, to its $67 billion acquisition of DirectTV - a move, he wrote, that produced "damaging results." At the same time, Cohn proposed cuts, saying AT&amp;T's organization was "unnecessarily complicated and inefficient, including a management layer that can be streamlined by reducing spans and layers and title proliferation."Only a week later, AT&amp;T's CEO Randall Stephenson publicly addressed Cohn's observations at a New York conference, acknowledging some of the points Cohn outlined "makes a lot of sense." And, <a href="https://www.wsj.com/articles/at-t-explores-parting-ways-with-directv-11568841544">as it was reported in The Wall Street Journal</a>, AT&amp;T has begun exploring a possible split with DirectTV. <h2>An institutional Elliott</h2>The saga unfolding at AT&amp;T is Cohn's latest work, set on a much grander stage than he has ever stood - a new peak for the $38 billion hedge fund's top lieutenant because of the company's size and influence that he's been building to.A review of his career should be required reading for AT&amp;T's board: From falling into finance as someone who didn't know what he wanted to do in his early 20s to becoming Paul Singer's attack dog on some of his most influential campaigns, Cohn has developed a reputation as a feared investor with the means to change America's blue-chip corporations.Conversations with more than two dozen of his colleagues, competitors, detractors, and friends also reveal an evolution. Cohn has developed a more diplomatic touch, as his targets have become larger and overhauls need approval by long-term shareholders such as BlackRock, State Street and Vanguard. People close to Cohn say he has gradually developed relationships with these large Wall Street investors, who hold key votes in any contest over how a large company is managed. He's on the boards of public companies like Citrix and eBay that he led campaigns on, as well as private companies that Elliott's private equity arm has bought outright. Chris Cernich, who once advised these large investors on how they should vote on some of Elliott's biggest proxy fights including oil and gas company Hess, went so far as to say Cohn is perhaps the perfect exemplar of how Elliott has become the most institutional of activist investors.Elliott "is one of the only activist funds that is not an alter ego of the founder," he said, as it maintains a corporate structure, with nine management committee members around billionaire Singer. At the same time, its investments have increasingly been packaged as a play for the long-term good of a corporation. This gives Cohn even more influence when he does go after a company like AT&amp;T. <h2>Cohn almost didn't join Elliott</h2>Fifteen years ago, Cohn almost didn't join Elliott. After spending two years on Morgan Stanley's M&amp;A team, Cohn began to look for hedge funds to join, accepting an offer from Elliott, which was then focused only on distressed situations. Cohn then later received an offer from a more "established fund," according to Ray McGuire, his boss at Morgan who is now Citigroup's global head of corporate and investment banking.It came as no surprise that Cohn had options. Originally a native of Long Island hamlet Baldwin, N.Y., Cohn was a computer whizkid in his youth, attending programming camps in the summer and earning a certification from software programmer Novell for his coding abilities before he could drive. (Years later, he pushed Novell to sell itself for more than $2 billion to Attachmate, where Cohn joined the board).He went to Wharton, where he was a part of a literary society, and graduated in 2002, when he started working for McGuire and prolific Wall Street dealmaker Paul Taubman at Morgan Stanley. There he helped make connections in the software and technology space that he eventually made his mark in at Elliott, sources say.At Morgan, McGuire said Cohn and fellow analyst Arta Tabaee, now a managing director at Clear Lake Capital Group, were always around, popping into his office with new ideas constantly. McGuire described Cohn as fearless and "Summa smart."The idea of joining Elliott ultimately prevailed. After talking his decision over with McGuire, Cohn decided to stick with his gut."I think that was an early, defining moment for Jesse, to honor his commitment," said McGuire, who is still in touch with Cohn today.In the subsequent years, the triathlon enthusiast would build Elliott's activism unit from scratch with a focus and energy that is unnerving to opponents and endearing to colleagues. He finds it difficult sitting still at his desk and often needs to take a break to walk through Central Park, according to those who have worked with him, bringing colleagues with him to strategize about their next investment.<h2>The birth of Elliott's activism</h2>Cohn started Elliott's activism unit in 2005 with a small investment in switchmaker and Cisco competitor Enterasys Networks, which he pressured to sell, doubling Elliott's investment in the process. The initial investment in Enterasys was only $15 million, but to Cohn it was huge, according to people close to him. He took a shine to hunting down the inner details of a business, cold-calling customers, employees, and engineers in the switchmaking industry for insights. The company had loyal customers, but its products weren't reaching enough people, he concluded. His career purpose began to take shape: He loved improving companies. Soon, a whole swath of other small tech companies came in to Cohn's crosshairs. They had compelling products, he thought, but their stocks were underperforming. So he amassed stakes in their businesses, approached their management, and told them they were doing it wrong. Oftentimes it wasn't pretty.In 2006, Harry Knowles was the CEO of bar-code systems maker Metrologic Instruments. After Metrologic underperformed that year, Knowles recalls Cohn approached him in an annual shareholder meeting and told him he would have to step aside and sell the company."He said, 'Hey, let me talk to you,'" said Knowles. "You don't have any choice."Knowles, then in his 70s, thought he was getting old for the job. He cooperated with Cohn in selling Metrologic to private equity shop Francisco Partners and Elliott for $440 million. The newly installed owners hired another CEO to replace Knowles, who in turn fired Knowles' close friends and jettisoned business lines that relied upon Knowles' personal involvement. The process was "painful," Knowles recalls.It wouldn't be the last time Cohn's pressure on companies would contribute to the fraying of relationships among company management.By 2012, Cohn set his sights on Compuware, a Detroit-based software company created by former Carolina Hurricanes owner Pete Karmanos. Karmanos was on his way out of the company after ceding leadership, ready for a happy retirement. But after Elliott bought a stake and pressed for layoffs and cost-cutting, he and his newly appointed CEO stopped getting along.As Cohn bought more and more of the company's stock, multiple expletive-laced arguments broke out between Karmanos and his chosen successor Bob Paul over whether to cut costs, including his own retirement parties that would have cost $1.5 million and rented out the Detroit City Airport, according to a lawsuit later lodged by Karmanos against his fellow board members.Karmanos's temperament soured more when Cohn ratcheted up the stakes and made a bid for the Compuware business as a whole at the end of 2012, phoning up Paul and telling him the bid would hit the press in 30 seconds, according to court documents. After the board declined the bid, Karmanos told a crowd of several hundred people at a business conference that if he were still in charge, he "would tell the hedge fund to go f--- themselves," according to a lengthy account of the matter in the <a href="https://www.freep.com/story/money/2015/07/25/karmanos-compuware-saga-detroit/30464355/">Detroit Free Press</a>.Testimony from board members in Karmanos's lawsuit detailed an aggressive approach by Cohn.They said Cohn had thick files of personal information on each board member with details on what jobs their spouses had and schools their kids attended. He had the files laid out on a conference room table when the board met with Cohn in Elliott's New York office. Karmanos has said he believed it played a part in intimidating his board into eventually selling.<h2>'We're the aggressors'</h2>Cohn's reputation as an attack dog intensified during his campaign against healthcare technology company Athenahealth.<a href="https://www.newyorker.com/magazine/2018/08/27/paul-singer-doomsday-investor">A feature story in The New Yorker</a> detailed his campaign last year against Athenahealth's former CEO Jonathan Bush, who said an anonymous Instagram user had taken pictures of him with a female friend and sent them to his wife. He wondered if Elliott was behind it - something the firm denies. Bush resigned from the company after a London-based reporter discovered details of domestic abuse in divorce filings from more than a decade ago. Elliott has repeatedly denied the claims made in the lawsuit and past media reports on the firm's tactics, including any insinuation that it placed the story about Bush's history of domestic violence. But sources say the stories played to the firm's benefit. Boards and lawyers are reticent to fight a firm with Elliott's reputation. The stock price of companies Elliott takes a stake in often jump when a campaign is announced. "Part of Elliott's story to their investors and to the media is 'we're the aggressors,'" said J.B. Heaton, a managing member of One Hat Research and a former lawyer that worked on activism cases, who has studied activism's effectiveness.Cohn's ability to create change within an organization has been rewarded by Singer.A couple years ago, Cohn paid $30 million for a penthouse in Manhattan's financial district that spans 6,000 square feet, according <a href="https://therealdeal.com/2017/05/03/activist-investor-appears-to-be-buyer-of-30m-duplex-at-30-park-place/">to media reports at the time</a>. <h2>Private equity powers </h2>One weapon in Cohn's arsenal that would make him even more effective came in 2015: a private equity fund Cohn created within Elliott, called Evergreen Coast Capital. The very nature of private equity - buying a company whole and improving its performance over as many as five years - was a departure from Cohn's reputation for seeking immediate change. The fund was started by Cohn <a href="https://www.ft.com/content/75eadbba-03a7-11e9-99df-6183d3002ee1">after Elliott lost out on a bid for a company in which it was an investor</a>: Riverbed Technologies, which Thoma Bravo and other investors bought in 2014. The fund has put billions of dollars to work, taking companies like Gigamon, Travelport and Athenahealth private. With a private equity fund at Cohn's disposal, he could walk into a board room meeting as a shareholder to talk about a company's performance, and then swiftly pivot, turning the conversation into a dialogue about a possible sale of the company to Elliott, one person familiar with his campaigns said.At least one instance where this happened was the sale of LifeLock Inc., a consumer protection company, which, after an initial meeting with Cohn in 2016, was sold to another company where Elliott was a significant investor: Symantec Corp. <h2>What AT&amp;T can expect</h2>At AT&amp;T, of course, executives don't need to worry about a possible buyout. The company is too large to be acquired outright. Instead, Cohn is seeking to extract concessions from the company's management to conduct its business differently, including halting plans for any merger and acquisition activity, outsourcing work, and closing "redundant stores." Labor union Communications Workers of America is fighting back against the proposals."Our position is that this business strategy will harm local communities that rely on the good jobs and advanced communications networks that flow from AT&amp;T investment," wrote labor union president Christopher Shelton in a letter to the AT&amp;T board. Cohn has joined the boards of companies he has pressed in the past, such as Citrix and eBay. While it's unknown if he will end up on the AT&amp;T board, Cohn's current and former board member colleagues say he isn't resistant to compromise once he's able to get a better understanding of the company.Fred Salerno, the chair of cybersecurity company Akamai's board, said Cohn had originally wanted to fire the CEO and sell the company, but relented after meeting with executives. "He's proven himself to be a very collaborative board member," said Bob Calderoni, who leads Citrix's board, which Cohn has been on for four years. Calderoni believes the time on boards has helped Cohn learn that "operating a company is different than investing in a company.""He's willing to listen and learn."Lately, Cohn's been consuming a steady diet of literature, from Bob Igor's book, "The Ride of a Lifetime," which offers a window into how Igor ran the Walt Disney Company as CEO, to "Dreyer's English," a book about writing by a top editor at Random House. A person close to Cohn says the latter book influenced his wordsmithing of the AT&amp;T letter. But while Cohn may be academic and cerebral, he hasn't lost the assertive nature for which he's so well known, people close to him say. Some are not so quick to believe Cohn's turned a new leaf at all. One person who has represented companies said that while Cohn is easier to negotiate with in producing quick settlements, he doesn't for a minute think anyone who gets in his way won't suffer his wrath. "The idea that he's turned a new leaf and he's a nice, kinder Jesse?" the person asked, considering the notion, before then quickly dismissing it."I don't know. Go read The New Yorker article."<a href="https://www.businessinsider.com/intelligence/connectivity-and-tech-pro?IR=T&amp;itm_source=businessinsider&amp;itm_medium=ctgr_bii&amp;itm_term=ctgr_subscription&amp;itm_content=tmobile&amp;itm_campaign=connectivity-and-tech-pro"><img src="https://static.businessinsider.com/image/5d5ed443bbb7c638302a9f74" alt="Signup Today: Connectivity and Tech Pro by Business Insider Intelligence" border="0" style="width: 100% !important" /></a> <div class="margin-top"> <h3>NOW WATCH: <a href="https://www.businessinsider.com/wework-ipo-scott-galloway-impact-jp-morgan-softbank-2019-9">Scott Galloway explains who gets hosed from WeWork's IPO disaster</a></h3> <div> <iframe class="bijwplayerclass" data-player="jwplayer" src="https://content.jwplatform.com/players/JsElzxji-CEZHWCBG.html" width="100%" height="100%" frameborder="0" scrolling="auto" style="margin:0px;" allowfullscreen=""></iframe><script>function receiveMessage(event){ console.log(event.data.fullscreen); Android.fullscreen(event.data.fullscreen); }window.addEventListener("message", receiveMessage, false);</script> </div> </div>

We talked to 24 people about the hedge fund wunderkind at Elliott Management who wants to shake up AT&T. Here's why management should be terrified.

<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/53bc5d306da811dd0cc8d7bf-900-600/525917_419661138053809_333866305_n.jpg" alt="michael dell dog" data-mce-source="Facebook.com/coletttedell" data-link="https://www.facebook.com/coletttedell" /><a href="https://www.facebook.com/coletttedell">Facebook.com/coletttedell</a>Dell CEO Michael Dell, with dogs.</div></div></div>Dell is paying $67 billion in cash and stock to buy up EMC, a $54 billion IT titan best known for its data-storage products, in the <a href="http://www.businessinsider.com/dell-acquires-emc-vmware-2015-10">biggest tech merger deal ever</a>.Plus, Dell gets a controlling stake in VMware, a $34 billion cloud-computing software vendor in its own right, which was 85% owned by EMC. Dell is raising about $40 billion in debt financing to make this deal happen.HP CEO Meg Whitman told employees on Monday that Dell is likely liable for <a href="http://www.businessinsider.com/meg-whitman-rallies-hpe-troops-in-email-2015-10">$2.5 billion in interest alone on that debt every year</a>. So why did EMC want to sell? Why did Dell want to buy? And does this acquisition have a chance of saving either company?<h2>EMC rose with the internet</h2>EMC was founded in Massachusetts in 1979, finding a niche as one of the first companies to make storage for the brand-new home-computer market. This is back when the PC was called a "minicomputer" because it didn't take up a tennis court's worth of space. Seriously. Eventually, EMC expanded into the enterprise-services market, making hardware and software to help its customers with its storage requirements. As the internet and corporate networks alike took off, demand for EMC's products went through the roof, particularly EMC's Symmetrix, which ruled the market by providing high-capacity storage to the growing data center market.In 1992, when then-CEO Michael Ruettgers took the reins, EMC booked revenues of $120 million. In 2001, when Ruettgers stepped down, EMC revenues were at $9 billion.<div class="KonaFilter image-container display-table"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/5446ddcbeab8eaa00362073e-2700-1530/joe-tucci.jpg" alt="EMC Joe Tucci" data-mce-source="EMC" data-mce-caption="EMC CEO Joe Tucci" data-link="https://www.flickr.com/photos/emccorp/3543669612/" /><a href="https://www.flickr.com/photos/emccorp/3543669612/">EMC</a>EMC CEO Joe Tucci</div></div></div>If nothing else, this means that there are plenty of EMC customers out there who have been working with the company since the 1990s. And they're unlikely to leave any time soon.<h2>VMware and other expansion</h2>Under current CEO Joe Tucci, who took the job in 2001, EMC broadened its product line. Instead of focusing on super-high-end storage arrays, EMC began to invest in growth areas like virtualization.Virtualization, at the most basic level, is a way to "trick" one server into thinking that it is multiple servers.So if you use virtualization software with 10 servers, they might act like a hundred, and so on. Data-center operators and server jockeys love virtualization because it can eke out a lot more efficiency from their existing server infrastructure and reduce overall spend. In 2004, EMC bought virtualization-software company VMware and turned it into a wholly owned subsidiary. In 2007, EMC listed VMware on the public markets, selling 15% of the company. Together, EMC and VMware sell joint storage solutions that take advantage of both technologies for a higher efficiency. VMware, much like EMC, was one of the first in its market, which led to an industry-leading position that it's enjoyed for a long time. It's the de facto standard for virtualization software in the <keyword id="6356323" type="UNKNOWN" weightage="100" keywordseo="Enterprise">enterprise</keyword>. And now Dell is snapping up the biggest chunk of it. Tucci's EMC also invested in other subsidiaries and spinouts, all of which support the overall EMC product line.That includes data analysis firm Greenplum, which makes software to help enterprises make sense of the data they've stored in systems like EMCs. It also includes Pivotal, which carries a mandate to help programmers make data-powered software.In short, under Tucci, EMC became one of the first big tech companies to make moves into the modern cloud-driven computing industries. <h2>Slowing growth</h2>With tons of cash in the bank, EMC isn't in danger of imminent extinction. But analysts are wary of EMC's slowing growth.The company is facing intense pressure as the IT industry moves more functions to the cloud. Instead of building and maintaining data centers, companies are offloading lots of functions to data centers run by Amazon, Microsoft, Google, and others.Like a lot of other old-guard tech providers, EMC has belatedly embraced the cloud, but cloud services tend to offer lower margins than selling software, which means that companies who weren't in the IT business - like Amazon, in particular - moved more quickly and aggressively and are leading the market.Back in April, EMC <a href="http://www.businessinsider.com/r-data-storage-provider-emc-cuts-forecast-blaming-strong-dollar-2015-4">slashed its full-year revenue forecast for 2015 by $400 million</a> to $25.7 billion, compared with the $24.4 billion it booked in 2014. In 2013, it booked $23.3 billion. VMware has been stalling out even more: <a href="http://www.businessinsider.com/vmware-reports-slowest-revenue-growth-in-7-quarters-2015-4">In April</a>, the company reported its slowest quarterly revenue growth in almost two years.Analysts have been downgrading EMC shares since January, citing imminent threats to its business. <div class="KonaFilter image-container display-table"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/55e0ed449dd7cc18008b6dc4-1050-700/pat-gelsinger2.jpg" alt="VMware CEO Pat Gelsinger" data-mce-source="VMware" />VMwareVMware CEO Pat Gelsinger</div></div></div>Facing intense competitive pressures from the likes of Amazon Web Services, which hosts EMC-like storage products on the Internet for a lot less cash, EMC has been forced to effect cost-saving methods, including <a href="http://www.businessinsider.com/emc-employees-brace-for-more-layoffs-2015-7">mass layoffs</a> and constant corporate reorganizations to its already-complex org chart. And VMware, which was one of the first to virtualization - which is actually a key technology at the core of cloud platform providers like Amazon Web Services - has been <a href="http://www.businessinsider.com/vmware-updates-platform-for-hybrid-cloud-2015-2">slow with its own entry into the cloud market</a>. If that wasn't enough pressure, both EMC and VMware are seeing their businesses threatened by a flood of cheaper alternatives. Data-crunching software like <a href="http://www.businessinsider.com/facebook-and-yahoo-have-created-influential-open-source-projects-2015-6">Hadoop and Cassandra</a> offer a way to store and analyze information the same way that EMC's solutions can.But where EMC offers a pricey solution that involves paying for both branded storage hardware and software licensing fees, that software lets you use off-the-shelf server hardware. Oh, and the software mentioned above? It's all available for free, forever.<div class="KonaFilter image-container display-table"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/55847a9369bedd1b6c36ab86-850-850/dave mariani.jpg" alt="AtScale Dave Mariani" data-mce-source="AtScale" data-mce-caption="AtScale founder, CEO Dave Mariani" />AtScaleAtScale founder, CEO Dave Mariani</div></div></div>There are plenty of startups, like <a href="http://www.businessinsider.com/new-dave-mariani-startup-atscale-gets-yahoos-jerry-yang-to-invest-2015-6">AtScale</a> or <a href="http://www.businessinsider.com/hedvig-avinash-lakshman-facebook-cassandra-data-storage-2015-3">Hedvig</a>, that take that free software and package it up into something easier for the customer to use. Even going with a commercial version of free software can still be a lot cheaper than tapping EMC.VMware is facing a similar threat: Apple, for instance, <a href="http://www.businessinsider.com/apple-dumps-vmware-esxi-for-kvm-2015-10">reportedly opted not to renew a contract with VMware</a>, instead choosing to go with Apache Mesos, a free data center operating system software that will let it reap many of the same benefits, totally for free.And Tucci, who led EMC into the modern era, has made no secret of the fact that he's been waiting for a worthy successor, and is ready to step aside as CEO. That's something that Dell can definitely offer. This means that a deal with Dell, which is an established player away from the prying eyes of the public markets, could be a blessing for EMC.But what does Dell get from the deal? <h2>Once upon a Dell</h2><div class="KonaFilter image-container display-table"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/50746dbbeab8eaa16c000003-1420-1034/screen-shot-2012-10-09-at-2.30.50-pm.jpg" alt="dude you're getting a dell first commercial" data-mce-source="YouTube/pepwave24" data-link="http://www.youtube.com/watch?v=sZi1Ouc4Wtk&amp;feature=related" /><a href="http://www.youtube.com/watch?v=sZi1Ouc4Wtk&amp;feature=related">YouTube/pepwave24</a>The "Dell Dude," Dell's official mascot during the early 2000's.</div></div></div>Dell may be best known as a PC manufacturer, but that's only part of the story.In the mid-nineties, Dell found its niche as a manufacturer of custom, built-to-order PCs sold via its web site, becoming one of the first to follow that model. It was the number-one PC manufacturer in the world for almost ten years.Dell became famous for squeezing every ounce of inefficiency from its manufacturing process, making it super competitive on price. Not long after, Dell found that it could apply its super-efficient process for making cheap Windows PCs to making cheap Windows servers, at a time when companies like IBM and HP had the market locked down with expensive servers running proprietary software.In 1994, Dell introduced its server line. By 1998, they were 13 percent of the company's profits. By 2001, Dell had 32% of the Intel chip-based server market. <h2>The commodity problem</h2>But by the mid-2000's, PCs had become a commodity. Competitors like HP had caught up with Dell's manufacturing process, meaning that Dell could no longer claim the price advantage. And consumers were no longer buying super-powerful high-powered computers, instead opting to grab cheaper models. Just to tread water, Dell had to institute deep price cuts, struggling to make it up on volume. It also didn't leave Dell a lot of cash to invest in R&amp;D, meaning that it couldn't invest much in mobile devices or other lines of business.<div class="KonaFilter image-container display-table"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/53642299eab8ea406b793cae-727-768/dell-1984.jpg" alt="Michael Dell 1984" data-mce-source="Dell Computer" data-mce-caption="Michael Dell 1984" data-link="http://www.pinterest.com/dell/heritage/" /><a href="http://www.pinterest.com/dell/heritage/">Dell Computer</a>Michael Dell in 1984, when the company was founded.</div></div></div>And So as the PC market started to shrink, Dell was hit hard. By 2011, Dell was only the third-biggest PC manufacturer in the world, behind HP and Lenovo. And apart from its still-vital server business, Dell didn't have much going on.Dell delisted itself from the public markets in 2013, hoping to get away from the quarter-to-quarter pressure for results.Diversification seems to be the name of the game with the EMC deal: If PC sales are shrinking with no signs of stopping, then it's time to double down on the enterprise. "Dell is fairly weak on storage, and EMC will help give it a full portfolio that it needs to compete with HP, Cisco, IBM, and the growing threat from Huawei," says Glenn O'Donnell, a Forrester analyst. Dell also has a virtualization business, selling server hardware designed to be used with more efficient virtual machines. VMware's business would make a nice complement there, too. Side note: Back in 2002, then-Dell President Kevin Rollins tried to buy EMC, citing concerns over Dell's PC dependency. Dell founder Michael Dell blocked him. <h2>Danger ahead</h2>The problem for both Dell and EMC is that this merger doesn't solve either of their problems. Cloud computing is still eating away at the enterprise-services market, with an increasing number of companies choosing to simply host some or all of their IT infrastructure with <a href="http://www.businessinsider.com/microsoft-beating-ibm-oracle-sap-cloud-forrester-2015-10">Amazon Web Services, Microsoft Azure, or Google Cloud Platform</a>, in efforts to save on server bills.<div class="KonaFilter image-container display-table"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/5526c5fceab8ea3d67b14d9a-3264-2448/slack for ios upload (13).jpg" alt="andy jassy aws" data-mce-source="Matt Weinberger" data-mce-caption="Amazon Web Services boss Andy Jassy at AWS Summit San Francisco 2015" />Matt WeinbergerAmazon Web Services boss Andy Jassy at AWS Summit San Francisco 2015</div></div></div>So while this deal may well make Dell's storage business more competitive with HP, it's just making it bigger fish in a shrinking pond. HP and IBM are going through their own painful transformations to fit this new market, so at least Dell's not alone, but it's still a time of great transformation.Plus, Dell will now be responsible for EMC's complicated corporate structure, streamlining it into its own existing, and large, operation.Dell's purchase of EMC gives it access to a bunch of new markets. But unless Dell has some kind of Hail Mary planned for its new friends at EMC, it's difficult to see how this acquisition is going to be worth the sheer amount of cash it had to pay in the long run. <div class="margin-top"> <h3>NOW WATCH: <a href="http://www.businessinsider.com/dell-dude-comeback-2014-10">How The 'Dell Dude' Could Bring Back Dell From Obscurity</a></h3> <div> <div> <script src="http://player.ooyala.com/v3/6e12e8b3387a44daacfb73afba25a76e"></script> <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="t2djZicTrAvWhFFeb8A5FYED9IULArh4" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div> <script> if (typeof RunFunctions === 'undefined') { var RunFunctions = []; } RunFunctions.push(function() { var ooyalapopvideo = OO.Player.create('ooyalaplayer_popvideo', 't2djZicTrAvWhFFeb8A5FYED9IULArh4',{ autoplay: 'false' }); }); </script> <noscript><div>Please enable Javascript to watch this video</div></noscript></div> </div> <script>(function() { function createPlayer() { OO.ready(function() { RunFunctions.forEach(function(ooyalaFunction) { ooyalaFunction(); }); RunFunctions = [];}); } createPlayer(); }()); </script> </div>

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