- Enterprise software leader VMware recently announced it completed the $2.7 billion acquisition of Pivotal Software
Enterprise software leader VMware recently announced it has completed the $2.7 billion acquisition of Pivotal Software, which is a leading cloud-native platform provider. Pivotal will now operate as a wholly-owned subsidiary of VMware.
As a result of the completion of the acquisition, Pivotal’s Class A common stock was removed from listing on the New York Stock Exchange with trading suspended prior to the opening of the market as of a couple of days ago.
Pivotal’s offerings are going to be core to the VMware Tanzu portfolio of products and services, which are designed to help customers transform the way they build, run, and manage their most important applications with Kubernetes as the common infrastructure substrate.
The combination of Pivotal’s developer-centric offerings with VMware’s upstream Kubernetes run-time infrastructure and management tools are going to deliver a comprehensive enterprise solution that enables dramatic improvements in developer productivity in the creation of modern applications. And VMware is able to offer product building blocks and integrated solutions that are tested and proven with technical expertise that customers need to accelerate software delivery across data center, cloud and edge environments.
“It’s my pleasure to announce Ray O’Farrell as the leader of VMware’s new Modern Applications Platform business unit—uniting the Pivotal and VMware Cloud Native Applications teams,” said VMware CEO Pat Gelsinger in a statement. “And as Pivotal is now part of VMware, I want to thank the Pivotal leadership team for building a great company. Together, we’re poised to be the leading enabler of Kubernetes with a deep understanding of both operators and developers.”
VMware is known for powering the world’s complex digital infrastructure. And VMware’s cloud, networking and security, and digital workspace offerings is known for providing a dynamic and efficient digital foundation to customers globally.
And Pivotal combines its cloud-native platform, developer tools, and unique methodology for helping the world’s largest companies transform the way they build and run their most important software applications. The company’s technology is used by Global 2000 companies to achieve strategic advantages in software development and IT operations.
“Digital transformation and the applications that drive it should not be restricted only to cloud and software giants,” added Ray O’Farrell, executive vice president and general manager, Modern Applications Platform Business Unit, VMware. “We believe that modern application development solutions and practices need to be easily accessible to everyday enterprises across the globe. With Pivotal’s developer capabilities as the foundation, we’ll focus on delivering consumable, enterprise-ready cloud-native offerings to customers to help them achieve better business outcomes.”
As part of the deal, Pivotal’s Class A common stockholders are entitled to receive $15.00 per share cash for each share held (without interest and less applicable tax withholdings), and Pivotal’s Class B common stockholder (Dell Technologies) received approximately 7.2 million shares of VMware Class B common stock, at an exchange ratio of 0.0550 shares of VMware Class B common stock for each share of Pivotal Class B common stock.
“Pivotal has fundamentally changed how the world’s biggest brands build and manage software with a focus on developer productivity through platform abstractions and development techniques as well as connecting the business with the developer,” explained Edward Hieatt, senior vice president, customer success at Pivotal. “The combination of Pivotal and VMware offers the most comprehensive application platform in the industry and is a win for our customers, a win for Pivotal, and a win for VMware. We’re excited to team up with VMware to help more enterprises become like modern software companies by adopting DevOps and Lean techniques developed by internet giants and the startup community.”
The companies have numerous mutual customers — including Raytheon — that have reacted positively to the news of the acquisition:
“By working with both Pivotal and VMware, we’ve been able to completely transform how we write software for our military and government customers,” noted Todd Probert, Vice President for C2, Space, and Intelligence at Raytheon. “Combining these companies under a single umbrella is going to make it possible for my team to get code to our customers even faster and easier.”
