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Perot Systems’ China Consultancy Deal and Dell’s Global Reach

Perot Systems’ planned purchase of BearingPoint’s China consultancy broadened its local consulting presence shortly before Dell completed its acquisition of Perot Systems.
From TheFinanceBase Team2 min to read
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Perot Systems announced on October 12, 2009, that it would acquire BearingPoint Management Consulting (Shanghai) Co., Ltd., a consultancy with offices in Shanghai and Beijing. The deal was intended to deepen Perot’s China capabilities; Dell’s separate acquisition of Perot Systems, completed on November 3, 2009, later extended Perot’s services to Dell customers worldwide.

What Chinese consultancy did Perot Systems buy?

The target was BearingPoint Management Consulting (Shanghai) Co., Ltd., which had entered China in 2001 and maintained offices in Shanghai and Beijing. Its industry experience included energy, automotive, insurance and financial services. The cited announcement did not state the purchase price for the China business. Source: Perot Systems announcement, October 12, 2009.

How did the China transaction fit into Dell’s acquisition of Perot?

These were two linked but distinct transactions: Perot announced its planned purchase of the China consultancy on October 12, 2009, while Dell had announced its agreement to acquire Perot Systems on September 21. Dell completed the Perot acquisition on November 3, 2009, and established Dell Services as a global business unit. The China consultancy deal therefore preceded the completion of Dell’s purchase; it was not the same transaction.

Transaction Scope and capability Timing Price disclosed in cited materials
Perot Systems’ planned purchase of BearingPoint Management Consulting (Shanghai) China-based management and technology consulting Announced October 12, 2009 Not stated in the cited announcement (Perot Systems announcement)
Dell’s acquisition of Perot Systems Worldwide services platform, including consulting and other IT services Agreement announced September 21, 2009; completed November 3, 2009 About $3.9 billion in cash in Dell’s 2009 public announcement; Dell’s 2011 filing recorded an accounting purchase price of $3.878 billion (Dell 2011 filing)

Why did Perot want a stronger China consulting presence?

Perot presented the purchase as a way to combine BearingPoint China’s consulting strengths with Perot’s global delivery model and broaden its business scope and capabilities in China. Perot also pointed to recent key contracts in Chinese health care and manufacturing, alongside BearingPoint’s existing sector knowledge. That mix could support a broader local platform across industries, while giving Perot a way to deliver consulting through its established international organization. Perot Systems announcement.

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What changed for Dell customers after the Perot acquisition?

Dell said the combination extended Perot Systems’ capabilities to Dell customers around the world, while making Dell products available to more Perot customers. Dell filing. Dell Services covered hosting, consulting, applications, business-process outsourcing, managed services and modular services. Dell announcement, November 3, 2009.

Dell’s 2009 public materials described a workforce of more than 41,000 professionals and approximately $8 billion in services revenue over the prior four quarters. Those figures describe Dell’s announcement-era services business, not revenue or headcount attributable to the China consultancy alone. Dell announcement.

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What was the financial scale of Dell’s Perot deal?

Dell’s 2009 public announcement rounded the cash consideration to $3.9 billion. In a 2011 filing, Dell reported an accounting purchase price of $3.878 billion and goodwill of $2.327 billion. The rounded public figure and the later accounting figure describe the Perot acquisition, not Perot’s China consultancy purchase. Dell 2011 filing.

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