The American computer manufacturer Dell Technologies will split off its majority stake in cloud company VMWare. This creates two completely separate listed companies. The deal allows Dell to raise billions to reduce its high debt.
Dell owns 81 percent of VMWare. Following the spin-off, VMWare will pay out billions in special dividends to shareholders, of which Dell could potentially receive $ 9.7 billion.
The Texas computer company acquired the majority stake through the 2016 acquisition of data storage group EMC, the parent company of VMWare. The acquisition was worth $ 67 billion.
Dell has been reviewing strategic options for California’s VMWare since the summer of last year. The technology group is weighed down by a debt of more than 48 billion dollars.
According to CEO Michael Dell, his company and VMWare will remain essential partners after the split-off, and as separate companies, they can better focus on growth opportunities.
Investors on Wall Street seem to appreciate Dell’s move. In so-called aftermarket trading, Dell’s stock rose 9 percent in New York due to the announcement.