NTT Data Strengthens Healthcare IT Portfolio with $3.05 Billion Acquisition of Dell's Perot Systems
According to The Wall Street Journal, Japanese IT services giant NTT Data announced on the 28th that it will acquire Dell’s information technology services division for $3.05 billion. This move is conducive to expanding NTT Data’s healthcare IT sector and addressing concerns related to technology and business process outsourcing.
NTT Data stated that this acquisition would help strengthen its influence in North America and expand its global service network. This is NTT Data’s largest deal to date, expected to create 28,000 new jobs in North America and India.
I. DellWhy SellPerro System？
Dell’s total sales revenue in 2015 amounted to $58.1 billion. To complete its $67 billion acquisition of EMC and alleviate debt pressure, Dell decided last April to divest certain non-core businesses within the group.
Dell’s IT services division was formerly Perot Systems, founded in 1988 by former U.S. presidential candidate Ross Perot. The company is one of the leading providers of technology consulting services to hospitals and government agencies in the United States.
In 1995, Perot Systems Healthcare Group was established. Meanwhile, Tenet Healthcare Corporation (a company formed through the acquisition of American Medical International by National Medical Enterprises) contracted with Perot Systems to integrate the IT systems and business processes of both companies and build an integrated technology environment.
On February 1, 1999, Perot Systems went public at an initial offering price of $16 per share.
In August 2003, Perot Systems further enhanced the payment processing capabilities of its existing healthcare business by acquiring VISION HEALTHSOURCE, a leading provider of medical billing and claims solutions in India.
In September 2009, Dell acquired Perot Systems for $3.9 billion.
II.NTT DataWithITTechnology as the Core, with a Global Strategic Layout
NTT Data Group, one of the five core groups under NTT (Nippon Telegraph and Telephone Corporation), a Fortune Global 500 company, is a leading IT services provider in Japan and was listed on the Tokyo Stock Exchange in 1995. Currently, NTT Data Group has established more than 200 subsidiaries and branches worldwide, covering over 40 countries and regions, with approximately 80,000 employees, ranking among the top 10 globally in the IT industry in terms of scale and strength.
70% of NTT Data’s clients are Fortune Global 500 companies, providing services such as electronic medical records, surgical management, telecommunications billing, and insurance claims processing to hundreds of suppliers.
The sluggishness of Japan’s domestic market has prompted Japanese companies to look overseas. In 2010, NTT Data acquired South African technology company Dimension Data Holdings PLC for $3.05 billion and U.S. technical services firm Keane Inc. for approximately $1.04 billion in the same year. Since 2011, NTT Data has spent a total of $540 million on overseas acquisitions, according to data from Bloomberg.
John McCain, CEO of NTT Data, stated, “There are still similar acquisition targets in the market. We aim to enhance our competitiveness and expand our market presence through such acquisitions.”
III. NTT DataIntegrated Management of Diverse Data in Pharmaceutical R&D OperationsASPServices
NTT Data collaborates with many of the world’s leading healthcare organizations to help them manage their business information, data, and technology. According to official website statistics, it has currently provided services to thousands of healthcare institutions, enabling them to adapt quickly and cost-effectively to dynamic market conditions and regulatory requirements.
Product Applications:
During the clinical trial phase of new drug development, data from medical institutions or research centers are collected electronically in real time and managed centrally, with the aim of shortening the development cycle and reducing costs. NTT Data provides an internet-based ASP (Application Service Provider) service that can be deployed and put into operation in a very short timeframe. Their services are primarily applied to EDC (Electronic Data Capture) and CDMS (Clinical Data Management Systems) during Phase I to Phase III clinical trials and post-marketing surveillance studies.
Product Features:
As a feature of ASP services, it reduces initial implementation costs.
Ease of operation and multifunctionality shorten the testing cycle.
Unlike most ASP services, the fee calculation is not affected by usage duration.
Advantages:
Achieved seamless system integration, improving data management efficiency.
Integrates the vast majority of functions necessary for clinical trials, offering excellent usability.
Stable server operation ensures seamless system application.
ASP Service for the Integrated Management of Various Data in Pharmaceutical R&D Operations.
For the pharmaceutical industry, we provide electronic clinical trial solutions that enhance the efficiency of new drug development.
Perot Systems boasts a robust global team specializing in healthcare consulting, services, and implementation, and has already entered the Chinese market. This acquisition serves as a significant boost to NTT Data, leveraging the combined expertise and industry specialists of both firms to deliver more diversified services to healthcare institutions.
By the afternoon of the draft release date (March 29), NTT Data Corp’s stock price had risen by 2.14%, closing at 5,740 yen.