Dell stock spikes over 7% after it says it's considering spinning off VMware
Dellsaid Wednesday it may spin off VMware, the software powerhouse it acquired five years ago in the EMC merger.
- Dell currently owns 81% of VMware.
- Dell said the plan would benefit shareholders, customers and partners of both companies, but would not happen before September 2021 to minimize federal tax implications.
- However, Dell said it is also considering other options, including maintaining its ownership of VMware.
Dell is considering splitting from VMware, just five years after the tech giant acquired the
The Texas tech giant announced Wednesday that it is exploring "a potential spin-off of its 81% ownership" of VMware which it bought in 2015 through a merger with EMC. VMware had been owned by the data storage company.Dell's acquisition of EMC and VMware transformed it into a bigger tech player, but the transaction saddled the company with a sizeable debt.
Dell said it is also considering other options, including maintaining its VMware ownership."Regardless of the options we are exploring to create additional value, we are accelerating our strategy, which remains unchanged," Dell CEO Michael Dell said in a statement. "We are focused on winning in the consolidating markets where we operate."
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