ROUND ROCK, Texas — Dell is buying Quest Software for $2.4 billion to expand its offerings as its personal computer business weakens in an era of smartphones and sleeker devices like the iPad.
The deal, announced Monday, capped a bidding war that began last month when Quest revealed that a mystery suitor had made an offer trumping a $2 billion sale that had been worked out with Insight Venture Partners in March. The secret bidder turned out to be Dell Inc., the second-largest PC maker in the United States, behind Hewlett-Packard Co.
Dell prizes Quest primarily for its nearly 1,300 engineers and its stable of software designed for businesses and government agencies. In particular, Dell is counting on Quest to help it sell more servers, networking and storage products, and computing services, all of which are typically more profitable than PCs these days. Selling PCs is also getting more difficult as consumers rely on smartphones and tablets.
Quest is Dell’s biggest acquisition since it bought the technology consulting firm Perot Systems for $3.9 billion in 2009.
The deal worked out well for Quest shareholders. The sale price translates to $28 per share, a 44 percent increase from Quest’s stock price before the Aliso Viejo, Calif., company announced its initial agreement with Insight. Dell is paying close to Quest’s 10-year trading peak of $28.10.
Buying Quest will more than double the size of Dell’s software business. Dell expects to complete the acquisition this year.