Dell, VMware shares surge on spinoff report

San Francisco, June 24 (SocialNews.XYZ) The shares of tech giant Dell Technologies surged on Wednesday amid reports that it is planning to sell its share in enterprise cloud major VMware worth $55 billion.

According to a Wall Street Journal report, Dell, which owns 81 per cent of software virtualization company VMware, is looking to either sell its holding or buy the remaining stake.

Dell shares were over 8 per cent high at $52.89 each.

VMware shares were also seen 4.5 per cent higher at $156.06, keeping its market value at around $67 billion, reports The Street.

"Dell Technologies Inc. is examining options including a spinoff for its roughly $50 billion stake in VMware Inc. as the PC maker seeks to boost the value of its shares," the WSJ report said on Tuesday.

"Dell recently kicked off a process to explore the possibility of unloading the stake or taking other steps that could include buying the rest of the cloud-software giant, according to people familiar with the matter".

In 2004, EMC (now Dell EMC) acquired VMware with $625 million in cash.

Dell owns 801 of the Palo Alto, California-based company, which it got as part of the deal when it bought EMC for $67 billion in 2015.

VMware in 2018 announced $2 billion investment in India over the next five years towards expanding its facilities, increase headcount and ramp up research and development activities.

Key to VMware's success has been innovation in products and strategic partnership with major players like Amazon, IBM, HP, Microsoft and Google.

Source: IANS