EMC (EMC +1.1%) and VMware's (VMW +5.6%) Pivotal Initiative will be taken public, EMC CEO Joe...

This news story has 7 comments:

Register or Login to rate comments »

derekrv Comment (1)
 
Naive comment - but if EMC owns 69%, and VMW owns 31%, in what way is the company public ?
13 Mar, 10:48 AM Reply Like

SA Editor Eric Jhonsa Comments (574)
 
Those are pre-IPO numbers. Naturally there'll be some dilution to the stakes following an IPO.
13 Mar, 10:54 AM Reply Like

freeze1617 Comments (3)
 
the shareholders of EMC will receive 69% and VMW shareholders will receive 31%. For ex: if the IPO is for 200 million shares. EMC gets 138 million to be split up to investors and vmw gets 62 million split to investors
13 Mar, 02:33 PM Reply Like

Jocardan Comments (22)
 
I own 925 shares of EMC. Does anyone know what this will mean to me?
13 Mar, 10:51 AM Reply Like

Ed's perspective Comments (228)
 
You will still own 925 shares of EMC and you will receive an additional certificate for some undetermined number of shares from the new/spun off organization. The EMC and VM Ware will trade ex-"dividend" for lack of a better term some undetermined amount /value that the spinoff supposedly represents.

Overall .... this typically works out well. The thing to watch for is if the values place on the new company deducted from the old company make sense and whether or not there are big payments / dividends back to the original company or a huge DEBT burden taken on by the new company to enrich the old company. THAT is mischief but i don't THINK that's in play here. We'll see.
13 Mar, 11:42 AM Reply Like

spybreaker Comments (235)
 
I bought shares of both EMC and VMW during the recent dips and my plan was to sell them on their way up. So are you saying that it's a good idea to hold them to recieve the new company shares which could potentially have a price boost during the IPO? I presume that the share price of EMC and VMW would drop relative to the IPO of the new company's share price? Wanted to know the overall impact on the value of my money in EMC and VMW. Thanks.
13 Mar, 11:59 AM Reply Like

SA Editor Eric Jhonsa Comments (574)
 
That depends on whether EMC/VMware choose to hold onto their post-IPO stakes in Pivotal. If they maintain their stakes, as EMC did with VMware following its IPO, no shares will be distributed.

But EMC/VMW shareholders would still benefit if the IPO performs well, much as EMC shares have benefited from VMware's performance.
13 Mar, 12:03 PM Reply Like