Since Dell's failed attempt to buy storage firm 3Par, analysts have been speculating the PC maker to acquire either Brocade, Compellent Technologies or CommVault. Recently, Dell lost 3Par to Hewlett-Packard
The latest deal represents a 3.34 percent discount to Compellent's closing price of $28.71 on Friday on the NYSE. Shares of Compellent were down nearly 3 percent to $27.90 in Monday's pre-market trade.
Excluding Compellent's cash, Dell will pay about $820 million.
"Compellent is a natural complement to Dell's expanding enterprise storage portfolio. The Compellent storage platform will enable Dell to provide customers additional mid- and high-end network storage solutions that simplify and reduce the cost of data management," Dell said.
The expansion in storage space will help Dell to compete with bigger rivals such as HP and IBM in the complex computer systems and technology services market that offers higher profit margins than the traditional desktop and laptop PC market.
Data storage plays an important role in cloud computing, an Internet-based computing whereby shared resources, software, and information are provided to computers and other devices on demand.
In November, EMC agreed to acquire data storage equipment company Isilon Systems for $2.25 billion.
Dell expects the Compellent deal, expected to close in early 2011, to add to its non-GAAP earnings in its fiscal 2012.
Dell said it also signed a reseller agreement with Compellent that extends the storage portfolio it can offer its worldwide customer base, effective immediately.
Shares of Dell ended Friday's trading at $13.89 on the Nasdaq.
International Business Times, The Global Business News Leader
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