Dell went private in 2013 after a $25 billion buyout by founder and CEO Michael Dell and investment firm Silver Lake. We recently heard some rumors that the company was thinking about going public again and according to a new report, it may be true. Dell is going to become a publicly traded company again following a $22 billion stock buyout which will leave Michael Dell and Silver Lake in charge of the company.
Dell’s strategy for becoming a publicly traded company again is simple. It involves buying its own tracking stock which will offer a “new class” of public stock in exchange. The stock will be traded on the NYSE. Dell says that the total market capitalization of the move is $21.7 billion.
The deal allows the two partners to solidify their control on VMWare which they got when Dell acquired EMC in 2015. The move will allow Dell to pay off its debt at a faster rate than it has been able to so far.
Earlier reports said that Dell was also considering an unusual reverse merger where the company would have sold itself to VMWare. Dell had considered an IPO alongside this “negotiated business combination” before settling on the share exchange it has announced today.
Interesting moves from Dell. Stay tuned.