Dell makes move to go public again after months-long review

Dell makes move to go public again after months-long review”

The implied value of the Class V shares is $109 a share, it added. The company went private in order to undertake a massive turnaround plan amid a wildly changing computing market, but now is ready to return as a public entity and as an even stronger force in the Tech sector.

Michael Dell now owns 72 percent of common shares in Dell, while Silver Lake owns 24 percent.

Dell went private in 2013 on the back of a landmark deal with founder Michael Dell and private equity firm Silver Lake, executing the largest privatization in the history of the technology industry.

VMware will maintain its independence as a separate publicly traded company while Dell Technologies will continue to own 81 percent of VMware common stock.

The tracking stock was created to help Dell finance its $67 billion purchase of data storage company EMC 2016, the largest technology takeover ever at the time and one that almost tripled the company's debt load. Each share of Dell Technologies Class V stock will be converted into about 1.37 shares of Class C common stock, Dell Technologies said.

In a press release on Monday, Dell said it aims to buy its own tracking stock as part of a deal valued at $21.7 billion.

It also means Dell will not have to raise any new money, because it will pay for the deal by issuing new shares and a $9 billion dividend it will receive from VMware.

The tracking stock has almost doubled in value since it was issued, closing Friday at $84.58.

After the deal, expected to close in the fourth quarter, holders of Dell's tracking stock will own between 20.8 percent and 31 percent of Dell depending on how many investors opt for cash, Dell said.

"We believe that this development is positive for VMware shares not only because it avoids the reverse merger scenario, but also because there is the possibility of VMware being taken out by Dell in the future as a "second step" following this transaction", FBN Securities analyst Shebly Seyrafi wrote in a note.

The tracking stock was created as a way to help finance Dell's purchase of storage pioneer EMC in 2016. Dell reported consolidated adjusted cash flow of $2.4 billion in its latest quarter, up by a third year-on-year. The company also paid off $13 billion in debt stemming from it EMC tie-up.

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