Dell and Hewlett-Packard have announced a $7.7 billion agreement to merge their computer and smartphone businesses.
The merger will create the world’s biggest integrated business, the combined company will have an $8.4 billion profit margin and its products will be sold in more than 2,000 U.S. retail locations.
HP, which will have a $2.9 billion loss in 2017, will keep its leadership in the PC business.
The merger will allow Dell to cut its profit margin by 25 percent from $3.3 billion in 2016.
It will also reduce Dell’s share of the smartphone market by 15 percent from 30 percent.
According to a statement from HP, the deal will help HP continue to grow and diversify into a broader consumer, enterprise and cloud computing product portfolio.
The deal also will allow the combined companies to deliver more value to their customers.
In a statement, Dell CEO Mike Hewlett said the deal was a “great first step” toward the future.
“We’re thrilled to announce that HP will be part of Dell’s new integrated computer and mobile business, bringing our full portfolio of PCs, mobile devices and tablets to more customers across the U.K., the U, and Canada,” Hewlett wrote.
“This is a great first step toward the new HP business.
HP’s global market position and strong customer and supplier relationships will continue to help us reach our full potential and we look forward to the exciting opportunities ahead.”
The deal was first reported by Bloomberg.