Dell votes in favour of going public again

  • Dell announced Tuesday that it has agreed to buy back the publicly traded “tracking” shares of VMware, a listed company that is about 80% owned by Dell.
  • The company confirmed the purchase price of $US120 per share of the tracking shares for a total of $US23.9 billion.
  • After the deal is completed, Dell will go public again without having to go through the usual initial-public-offering process and will trade on the New York Stock Exchange starting on December 28.
  • The acquisition has faced strong opposition from billionaire activist investor Carl Icahn, VMware’s second-largest shareholder, who says the shares are worth $US144 apiece.

Dell announced Tuesday that it has agreed to a deal that will take the company public again.

Dell said that more than 61% of stockholders voted in favour of buying back the publicly traded “tracking” shares of VMware, a listed company that is about 80% owned by Dell. The shares were born as part of Dell’s complicated deal to buy EMC a few years ago.

The company confirmed the purchase price at $US120 per tracking share, amounting to $US23.9 billion. After the deal is completed, Dell will reenter the public markets without having to go through the usual initial-public-offering process.

“Dell Technologies Class C shares expected to begin trading on the New York Stock Exchange (NYSE: DELL) on December 28, 2018,” Dell said in a press release.

The acquisition has faced strong opposition from the billionaire activist investor Carl Icahn, who owns and 8.3% stake and is VMware’s second-largest shareholder.Icahn sued the company last month about Dell’s proposed $US21.7 billion offer for the tracking shares. He believes the shares are worth $US144 apiece.

Icahn isn’t the only one concerned about the deal. In February, Morgan Stanley analysts Keith Weiss and Sanjit Singh called it the “worst case scenario” for VMware shareholders. They see VMware being worth $US143 a share.

The DVMT tracking stock was up 26.7% this year.

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