Dell set to return to public markets

Bloomberg

Dell Technologies Inc won a shareholder vote to return to public markets, putting founder Michael Dell on the winning side of a transformative transaction that polarised investors for the second time in five years.
Under terms of the deal, Dell will buy out shareholders of the stock that tracks Dell’s stake in software maker VMware Inc, known by its ticker DVMT, for $23.9 billion worth of cash and shares.
After going private in one of the biggest leveraged buyouts ever, Dell will relist as a financially stronger and more diverse leader in computer equipment and software, though more burdened by debt. The move will help simplify a tangled corporate structure that holds together a tech empire ranging from servers to security software and give the company greater flexibility to raise capital, boost its value and pursue stock-based acquisitions.
It will also let key investor Silver Lake, which helped take Dell private in 2013 in a deal worth about $24 billion, make its stake more liquid. The path to the vote hasn’t been easy, as investors balked at Dell’s initial offer and forced it to sweeten the bid to get the transaction over the finish line. Dell increased its offer to about $120 a share in cash and stock, from $109 — financed by Dell and a special
dividend from VMware.
“With this vote, we are simplifying Dell Technologies’ capital structure and aligning the interests of our investors,” Michael Dell, the chief executive officer of the company he founded in his dorm room, said in a statement.
DVMT shares rose less than 1 percent to $104.73 at the close in New York. VMware’s stock also climbed less than 1 percent to $164.50.
In its time away from public market scrutiny, Dell, once a household name for its personal computers, has invested in boosting its capabilities in cutting-edge software and cloud integration. It’s now known for its lineup of servers, storage hardware and networking gear. Through its $67 billion acquisition of EMC Corp in 2016, Dell also now has a growing suite of software tools. The company has sought a symbiotic relationship with its hardware and
software — chasing closer integrations between the two and selling both to customers to
extract higher profit margins.