| From: Glenn Petersen | 12/28/2018 12:01:38 PM | | | | | | VMware to pay previously announced one-time special dividend on Dec. 28
By Ciara Linnane
MarketWatch
Published: Dec 28, 2018 7:49 a.m. ET
Enterprise software company VMware Inc. VMW, +1.61% said Friday it will pay its previously announced one-time special dividend on December 28. The company will make the $11 billion payment to shareholders of record as of close of business on Dec. 27. It expects that 60.39% of the dividend will be treated as a taxable dividend for U.S. federal tax purposes, with the remainder being treated first as a return on capital and then as a capital gain. Shares were slightly higher premarket and have gained 23% in 2018, while the S&P 500 SPX, +0.27% has fallen 6.9%.
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| From: Glenn Petersen | 1/1/2019 11:49:30 AM | | | | | | Here's What's Going On With VMware and Dell Today
VMware is down big after paying a massive special dividend, Dell is a publicly trading company again, and the tracking stock is no more.
Timothy Green
Motley Fool
Dec 31, 2018 at 2:46PM
What happened
Dell Technologies completed its journey back to the public markets last Friday by acquiring all outstanding Dell Technologies Class V ( NYSE:DVMT) stock. The transaction also involved VMware ( NYSE:VMW), which Dell controls with a roughly 80% stake. VMware paid shareholders a one-time $11 billion dividend on Friday as part of the deal, with most of that payout going to Dell.
Shares of Dell were up about 3.4% at 1:30 p.m. EST, while the Class V shares are no longer trading. Shares of VMware were down 14.3% from Friday's close, reflecting the payment of the special dividend. Today is the ex-dividend date. Adjusted for the special dividend, VMware stock was up about 3%.
source: Dell.
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So what
The Dell Class V stock was a tracking stock intended to track the performance of Dell's stake in VMware. The stock was originally issued as part of Dell's deal to acquire EMC, which closed in 2016. EMC owned 81% of VMware prior to being acquired by Dell.
Dell successfully exchanged a mix of cash and new Class C shares for all outstanding Class V shares on Friday. The company paid $14 billion in cash and issued nearly 150 million Class C shares to retire the tracking stock. The move greatly simplifies Dell's corporate structure, and it brought Dell back to the public markets without the need for a public offering.
Class V shareholders had the option to receive either $120 in cash or 1.8066 Class C shares for each Class V share, up to a $14 billion aggregate cash limit. More than 90% of shareholders chose the cash option, with the rest picking the share option. Because the cash limit was exceeded, shareholders who opted for cash will receive a portion of their payment in Class C stock. The cash option was the smart move, with shares of the Class C stock currently trading for around $47 per share.
As part of the transaction, VMware paid a one-time special dividend totaling $11 billion. The dividend is payable to shareholders of record at the close of business on Dec. 27, with a payment date of Dec. 28. Dec. 31 is the ex-dividend date. The $11 billion payment works out to $26.81 per share.
"Dell Technologies was created to be the essential infrastructure company for this digital era, and with today's announcement, we are aligning the interests of our stakeholders to benefit from the integrated innovations and value creation from across our entire family of businesses," said Dell CEO Michael Dell in the press release announcing the completion of the transaction.
Now what
With the tracking stock gone and Dell back in the public markets, investors can now bet on the company as a whole, not just on its stake in VMware. Dell's revenue has been growing briskly, with 15% year-over-year growth in its fiscal third quarter. But the company is still saddled with a substantial amount of debt. As of Nov. 29, Dell had about $48.7 billion of debt and $17.5 billion in cash. The dividend received from VMware will pay for part of the cash portion of the tracking stock purchase.
VMware now has quite a bit less cash after paying the one-time dividend. Total cash as of Nov. 29 was $13.5 billion, along with about $4 billion of debt. This deal will make VMware's balance sheet a lot weaker.
After going private in 2013 and creating its complex share structure a few years later to finance the EMC deal, Dell has undone those moves and is once again a public company. How it all works out this time around remains to be seen.
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| From: JakeStraw | 3/1/2019 8:40:00 AM | | | | | | VMware Reports Fourth Quarter and Fiscal Year 2019 Results
finance.yahoo.com
“Q4 was a terrific ending to a strong fiscal ’19 driven by broad-based strength across our diverse product portfolio and in all three geographies,” commented Pat Gelsinger, chief executive officer, VMware. “VMware is providing the essential ubiquitous software foundation for our customers’ digital transformations while we also work to drive positive global impact across our people, products and the planet.”
“We’re pleased with our performance in the quarter and for the year, including the return of $11 billion dollars to shareholders through a special dividend in December,” said Zane Rowe, executive vice president and chief financial officer, VMware. “We continued to drive deeper engagement with our customers and partners, who leverage the VMware portfolio for their business initiatives.” |
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| From: JakeStraw | 3/1/2019 2:44:14 PM | | | | | | | VMware had its price target raised by analysts at Deutsche Bank AG to $200.00. They now have a "buy" rating on the stock. |
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| From: JakeStraw | 4/29/2019 2:12:55 PM | | | | | | Microsoft Corp. unveiled a partnership with VMware Inc. in a bid to bring more customers to its Azure cloud-computing service, emulating a pact that has benefited rival Amazon.com Inc.
The agreement will let VMware customers move their technology systems to Microsoft’s Azure cloud-computing services, the companies said Monday in a statement. Amazon Web Services, the leader in the market for cloud services, struck a partnership with VMware in 2016 to lure customers of the virtualization software maker to AWS.
finance.yahoo.com |
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| From: JakeStraw | 5/17/2019 11:37:57 AM | | | | | | | VMware had its price target raised by analysts at Barclays PLC from $200.00 to $224.00. They now have an "overweight" rating on the stock. |
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| From: JakeStraw | 5/23/2019 3:13:23 PM | | | | | | VMware to Present at the Bank of America Merrill Lynch Global Technology Conference
vmware.com
VMware, Inc., today announced that Sanjay Poonen, VMware’s chief operating officer, customer operations, will present as a speaker at the Bank of America Merrill Lynch Conference in San Francisco, CA on Tuesday, June 4, 2019 at 11:00 a.m. PT/ 2:00 p.m. ET.
A live webcast will be available on VMware’s Investor Relations page at ir.vmware.com. The replay of the webcast will be available for two months. |
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