Does HP’s Breakup Clear Path for EMC Deal?

Hewlett-Packard (HPQ) isn’t saying and nobody’s publicly asked EMC (EMC), but is it possible the acquisition deal the two IT giants have talked about on and off for a year may be jolted back to life with HP’s breakup?

Could current HP boss Meg Whitman, who will serve as president and chief executive of the spun-off enterprise operation and hold a board seat, convince the top brass around her either to buy EMC outright, or, perhaps, to sell off the enterprise business to the storage giant if the price were right?

HP’s talks with EMC reportedly included the idea of cleaving the PC/printer businesses from the enterprise operation. Perhaps HP held the possibility out as a carrot for EMC to make the deal or EMC suggested or insisted on it as a condition of doing business together. Reports have indicated the two were engaged in high-stakes haggling over price, so anything’s possible in negotiations at that level.

Whitman certainly hasn’t laid to rest the EMC deal or any other possibilities, saying publicly that HP’s new Enterprise business will have a balance sheet “tilted” toward M&A and confirming the vendor has acknowledged to Wall Street it’s working on material, non-public information that could signal the EMC deal is still alive.

A number of financial types asked about HP’s M&A options by Investor’s Business Daily lined up on the side favoring activity with the enterprise business.

“The enterprise segment would likely be the first to go,” Bill Kreher, an Edward Jones analyst, told IBD. “If (EMC is) going to go with these more integrated solutions, then HP has an offering for basically every technology that is available, whether it’s storage or hardware or networking.”

Brian White, a Cantor Fitzgerald analyst, told IBD that HP’s split gives EMC the “flexibility” to buy the enterprise operation now that it wouldn’t also have to swallow PCs and printers it didn’t want or need.

Whitman, on record as insisting the two HP operations stay together since 2011 when the last talk of HP spinning off or selling the PC business occurred, has admitted “the time is right” to separate PCs/printers from enterprise products and services to accelerate growth possibilities.

What’s clear is Whitman has migrated her grand plan upstream from carving out HP’s recovery through hand-to-hand sales combat to the bigger picture of crafting the vendor to better fit how IT has changed since she took the helm three years ago. That less myopic view insists she now be regarded as a different class of visionary company leader.