Dell is planning to buy back VMware tracking stock from the EMC acquisition and go public once again. Specifically, Dell is going to buy back the stock for $120 per share at a deal value of $23.9 billion. And then Dell is expected to go public on December 28th.
Holders of over 61% of Dell Technologies’ Class V common stock voted in favor of this deal, according to a company filing. “We appreciate our stockholders’ support. With this vote, we are simplifying Dell Technologies’ capital structure and aligning the interests of our investor,” said Dell Technologies chairman and CEO Michael Dell in a statement. “This strengthens our strategic position, as we continue to deliver innovation, long-term vision and integrated solutions from the edge to the core to the cloud. We’ve created Dell Technologies to be our customers’ most trusted partner in their digital transformation.”
Photo Credit: Dell.com
Portions of Dell Technologies have been publicly traded through VMware and the tracker stock. But Dell’s Class C shares will allow investors to invest in Dell Technologies. These stocks will be sold on the New York Stock Exchange under the “DELL” ticker.
“We believe that Dell Technologies is best positioned to succeed in today’s data-driven economy thanks to the unique collection of businesses that Michael and his team have assembled and look forward to remaining long-term investors in the company,” added Silver Lake managing partner and managing director Egon Durban. “It is exciting to be able to now share the value creation across all of the businesses and assets of Dell Technologies with public investors, and we look forward to them joining us on this journey.”
Durban is known for helping lead the leveraged buyout to make Dell a private company back in 2013. Dell originally went public in 1988 and then private again in 2013 in a $24.4 billion deal.
Dell currently has a $50 billion debt load due to the $67 billion acquisition of EMC. A portion of the EMC deal was a payout to shareholders of VMware’s tracking stock. And VMware is still a separate public company under the ticker “VMW.”
EMC acquired VMware for $625 million in cash back in 2004. And then EMC sold 15% of VMware to the public through an IPO three years later.
Before this vote, billionaire activist investor Carl Icahn sued Dell after the company announced a price of $21.7 billion for the tracking stock. Eventually, a compromise was made.
