(Reuters) - EMC Corp (N:EMC) said it would pay Dell Inc [DI.UL] $2 billion (1.31 billion pounds) if its about $67 billion deal with the world's no. 3 computer maker is terminated for a "superior proposal" before Dec. 12.
The record merger agreement announced on Monday included a 60-day 'go-shop' provision that allows EMC to solicit bids from other parties and pay a discounted breakup fee to Dell if a deal is made with another company.
EMC said on Tuesday it will pay $2.5 billion if it opts for a superior offer after the go-shop period.
EMC will pay an additional $2.5 billion if it enters into a deal with another company within 12 months of terminating the deal with Dell.
While IBM Corp (N:IBM), Cisco Systems Inc (O:CSCO), Oracle Corp (N:ORCL) and Hewlett-Packard Co (N:HPQ) could be potential suitors for EMC, the chances of them challenging Dell with a rival offer are slim, people familiar with the matter have told Reuters.
Tuesday's agreement also requires Dell to pay EMC a termination fee of $4 billion under specified circumstances and in certain instances, an alternative termination fee of $6 billion, EMC said in a regulatory filing. (http://1.usa.gov/1MonKTB)
EMC shares were down 1.2 percent at $28 in premarket trading on Tuesday.