Shares of Dell fell nearly 4 percent to close at $13.36. Compellent lost 2.5 percent to close at $27.98, although the stock has risen more than 50 percent as speculation has grown that it was one of several potential acquisition targets in the data-storage space.
Dell had disclosed the negotiations with Compellent last week, including a proposed sale price of $27.50 a share, a move that some analysts said may have been aimed at tempering market expectations for a higher deal value.
Texas-based Dell put the final deal's total equity value at about $960 million and the aggregate purchase price at about $820 million, net of Compellent's cash.
The companies said they expect the deal to close in early 2011.
Dell had been looking to expand its data-storage port folio to become more competitive in the corporate technology market. Earlier this year, it lost a bidding war with rival Hewlett-Packard for 3Par Inc.
The 3Par bidding war triggered a rise in the shares of data-storage companies as Wall Street anticipated the wave of data-storage mergers to continue. Compellent shares have soared more than 130 percent since mid-August.
The focus on data storage was based largely on the push toward cloud computing, which lets companies tap computing power through a network instead of in-house data centers.
'Higher margins'Wedbush analyst Kau shik Roy said the Compellent deal gives Dell "a product that is much higher margins than what they sell — PCs and servers."
"They are building their own storage product portfolio, which from Dell's standpoint (is) the right to do," he said by e-mail.
But analysts also said the deal could harm Dell's ties to data-storage giant EMC Corp.
"We think the Compellent deal will cause further strain on the EMC relationship," Wells Fargo analyst Jason Maynard said in a note. "However, Dell still has product holes in the high-end storage and deduplication markets, so we think there is room for Dell to continue to resell EMC VMAX and Data Domain."
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