(Image: Dell Technologies)
In its latest turn of corporate machination, Dell Technologies has decided to return to the public market via a cash and share-swap deal that's meant to help the company boost revenue and raise funds.
The computing giant plans to convert existing Class V tracking shares into Class C common stock to form a publicly traded company with a market capitalization of $21.7 billion[1]. Dell's stock will list on the New York Stock Exchange.
Dell Technologies founder and CEO Michael Dell took his company private nearly five years ago after more than two decades on the stock market in a deal worth $24 billion[2]. In 2016, Dell acquired EMC in a massive $67 billion[3] deal. The agreement also included EMC's majority stake in VMWare, which now has a market cap of around $50 billion, as well as ownership of Pivotal, SecureWorks, RSA and VirtuStream.
Earlier this year, Dell disclosed that it was considering a reverse merger with VMware as part of its public market return. While that scenario didn't quite play out, VMware is still integral to Dell's public market return. VMware is financing the cash component of the deal with a one-time, $11 billion special dividend paid pro-rata to its shareholders.
Once the deal closes, DVMT shareholders (Class V shareholders) will own between 20.8 percent and 31 percent of Dell depending on cash election amounts.
"Over the last five months, with the assistance of our independent financial and legal advisors, we have conducted a thorough evaluation of a number of alternatives to maximize stockholder value," said a special committee[4] of VMware directors.
Michael Dell, who will continue on as CEO and chairman after the deal, said