Big Dell Deal?

The Wall Street Journal is reporting that Dell is considering a range of strategic alternatives that could transform the maker of PCs and data-storage devices.

According to the story, the review, which is in a preliminary stage, Dell is expected to explore options including an IPO and a purchase of the rest of VMware, a publicly-traded cloud infrastructure company

Currently, VMware has a market value north of $50 billion.

If Dell pursued a public listing, writes the Journal, it would be one of the biggest IPOs in recent years, and could also provide the company with cash to invest in the business and pay down debt.

The backstory: Dell went private in a roughly $25 billion leveraged buyout in 2013 by Its founder, Michael Dell, and investment firm Silver Lake. In 2016, Dell bought EMC for $67 billion in the largest technology takeover ever.

Bloomberg is also now reporting this story, and indicated that the board is meeting later this month to discuss strategic options, including the IPO.

Raising cash could help the company further expand or pay off some of its debt, Bloomberg continues, noting that Dell currently has about $46 billion in debt.

Dell is also considering a public share sale for its Pivotal Software Inc. cloud-computing venture. Dell met with bankers last year to discuss that possibility and was told the company could fetch a valuation of $5 billion to $7 billion, said one of the people. Still, any Pivotal offering may wait until the company has converted more of its business into wider-margin software and subscriptions and away from less-profitable services businesses, the person said.
– via Bloomberg.com