EMC Corporation and Documentum, Inc. have announced a definitive agreement whereby EMC will acquire Documentum in a stock transaction valued at approximately $1.7 billion. EMC's acquisition of Documentum combines two information-centric technology companies with a shared commitment to enabling organizations to maximize the value of their information across the enterprise. Documentum and EMC have worked together since the April 2002 introduction of EMC Centera, a content addressed storage (CAS) solution. Documentum's enterprise content management software platform is one of more than 65 applications that have integrated with Centera's open CAS platform under the EMC Developers Program.
Under terms of the agreement, Documentum stockholders will receive 2.175 shares of EMC common stock for each share of Documentum common stock. The acquisition is subject to customary closing conditions, including Documentum's stockholder and regulatory approvals, and is expected to be completed in the first quarter of calendar year 2004. When completed, EMC expects to take a charge in the quarter the transaction is closed for the value of Documentum's in-process research and development costs and other integration expenses. Including the aforementioned charges, the transaction is expected to be dilutive in the first quarter of 2004 by $0.02 per diluted share. The transaction is not expected to materially impact EPS for the remainder of 2004, and is expected to be slightly accretive in 2005.
Upon completion of the acquisition, EMC intends to operate Documentum as a software division of EMC headquartered in Pleasanton, California, led by Dave DeWalt, Documentum's current CEO. Documentum's sales, marketing and services will remain focused on selling and servicing Documentum's products and solutions.