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Posted by Henry Dewing on July 16, 2010
NTT is set to buy Dimension Data (DiData) for US$3.2 billion. For decades, customers have lamented their traditional telco service providers’ lack of IT integration depth — today, NTT appears to be putting its money where its customers want. Following in the footsteps of more focused deals like BT’s acquisition of Wire One or AT&T’s acquisition of VeriSign’s Global Security Consulting Business, the acquisition of Dimension Data signals NTT’s intent to be a superpower in worldwide information and communications technology (ICT) solutions delivery. But, make no mistake, it is still only a small acquisition for NTT — as one of only three telcos in the world with more than US$100 billion in revenues, the US$3.2 billion acquisition price will have only incremental effect on the firm’s balance sheet.
Other than the right to say NTT owns a highly respected global ICT integrator, what’s in the deal for NTT?
Much was made of the complementary business lines and geographies in the press release. While that may mean that the businesses can continue to operate independently with ease, I believe NTT will have its work cut out for it to deliver extra-normal returns from the acquisition — and change the face of the ICT market moving forward. How can it do that? I see a few strategies that will help:
When the deal closes in the fourth quarter, I hope to see the combined company deliver the full set of managed services (from networks to applications and from on-site to in the cloud) across the ICT market landscape leveraging the unique capabilities and geographic coverage that this global juggernaut has to offer.
How do you think the integration will be executed? And what do you think is the highest priority for the combined company when the deal is closed? Please join the conversation and leave a comment.
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