Is Dell in the market for a GlassHouse?

Contact: Brenon Daly, Simon Robinson

After getting its M&A machine revving in the second half of 2007, Dell largely unplugged it after that. It has inked just three deals over the past year and a half, and only one of those has been significant. In February 2008, Dell spent $155m for email-archiving company MessageOne, in a transaction that was a bit of a family affair. The other two buys: a $12m play for a consulting shop and a tiny amount for a Web address to help sell its Adamo line of laptops.

And now, Dell’s efforts to bring in a new executive to do deals for the company have gotten hung up. David Johnson, formerly IBM’s top dealmaker, had been tapped to take over that role at Dell. However, Big Blue sued Johnson, saying the move to Dell would violate the terms of his employment agreement. (Meanwhile, back in Armonk, New York, Cosmo Nista, who had worked corporate development for IBM’s hardware division, has been named acting head of M&A at the company, replacing Johnson, according to one source.)

If Dell is looking to do a deal, our research director for storage, Simon Robinson, has come up with a pretty solid nomination: GlassHouse Technologies. The IT infrastructure services vendor pulled its IPO paperwork in March and recently indicated that it may do some shopping of its own. However, if GlassHouse were to go to the other side of a transaction, it could very well be in a sale to Dell, which is already an investor in GlassHouse as well as being its largest partner. And strategically, the services offered by GlassHouse would fit nicely with Dell’s effort to become a larger supplier of servers and storage to its enterprise customers.