Dell was reportedly competing against a group led by private equity firm Insight Venture Partners to buy Quest.
Dell and Quest said the purchase price is net of Quest’s cash and debt and the transaction is expected to close during Dell’s third fiscal quarter.
Quest will help Dell provide server, storage, networking and end user computing solutions and services to customers, said John Swainson, president of Dell’s software group.
Dell’s distribution, reach and brand are well-recognized in the industry, said Quest CEO Vinny Smith.
Dell recently formed the software group and wants to increase the amount of intellectual property in its portfolio.
Quest will bring more than 1,500 software sales personnel and 1,300 software developers to complement Dell’s existing software offerings in systems management, security and cloud integration, Dell said.
The employees will be part of a $1.2 billion software business, based on annual revenue, according to Dell.
Dell will integrate Quest’s One Identity and Access Management solution family to its security portfolio, which already includes SonicWALL and Secureworks.
Quest will also provide Foglight performance monitoring software, Windows server management solutions for application modernization and database management.
Dell will use Quest’s server management solutions to complement its acquisitions of Clerity Solutions and Make Technologies, Dell said.
According to Dell, Quest generated $857 million in global revenue based on its fiscal year 2011 results at gross margins of 86 percent and operating margins of 11 percent.
Quest, founded in 1987 and headquartered in Aliso Viejo, Calif., works with more than 100,000 customers, including nearly 87 percent of Fortune 500 companies.
The company has approximately 3,850 employees and operates 60 offices in 23 countries.