Round Rock-based Dell confirms possible merger with VMware

Round Rock-based Dell Technologies, Inc. will again become a public company after a stock deal with one of its subsidiaries, VMware.

Round Rock-based Dell Technologies, Inc. will again become a public company after a stock deal with one of its subsidiaries, VMware.

Editor's Note: Multiple national news outlets reported the possible merger between Dell Technologies and VMware on January 25 using unnamed sources. However, Community Impact Newspaper chose to wait to publish until we received official, on-the-record confirmation from sources at Dell.

Round Rock-based Dell Technologies, Inc. confirmed that the company is exploring the possibility of a merger with VMware, among other options, in a filing with the U.S. Securities and Exchange Commission Friday morning.

The first option listed in the filing is conducting business as usual and continuing in the company's existing infrastructure. The second option is a public stock offering, or IPO, of the Dell Technologies Common Stock. The final option is a "business combination with VMware." Dell currently owns 82 percent of VMware, so the combination would be a reverse merger.

VMware provides cloud infrastructure and digital workspace technology.

In the filing, Dell Technologies Founder and CEO Michael Dell said the deliberation would normally remain confidential, but because Dell owns a portion of VMware, they are required to make the public filing with the SEC.

VMware was part of Dell's acquisition of EMC for $64 billion in 2016.

You can read the full filing here.

The technology company has not said when a final decision will be made or what any change could mean for its Round Rock-based headquarters, which has been a significant economic generator for the city since Dell relocated in 1994 from Austin.

The move helped expand the city's tax base, resulting in several improvements without increasing the city property tax rate:

• The expansion of Round Rock's water plant,

• An additional wastewater treatment plant, and

• The development of the 570-acre Old Settlers Park

Source: City of Round Rock's fiscal year 2017-18 adopted budget

Dell is the city's largest employer with an estimated 12,000 employees in 2017. The second largest employer, Round Rock ISD, had 5,800 employees during the same time. Since moving to Round Rock, Dell has been the city's largest taxpayer, with a 2017 net assessed valuation of $391,116,340, which is more than double the net assessed valuation of the second largest taxpayer.

Dell was also the seventh principal water customer in Round Rock in 2017, consuming 92,367,700 gallons of water.

“The public filing today shows Dell Technologies remains an incredible success, and the company is exploring opportunities to be even more successful. That’s great news, though certainly not unexpected," the city officials said in a statement. "For now, it’s business as usual for the City and Dell.”

By Iain Oldman
Iain Oldman joined Community Impact Newspaper in 2017 after spending two years in Pittsburgh, Pa., where he covered Pittsburgh City Council. His byline has appeared in PublicSource, WESA-FM and Scranton-Times Tribune. Iain worked as the reporter for Community Impact Newspaper's flagship Round Rock/Pflugerville/Hutto edition and is now working as the editor for the Northwest Austin edition.


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