Carl Icahn has been the public face of pushback against the first offer, saying it transfers too much value to Michael Dell and co-owner Silver Lake.
Sources say the new negotiations put the valuation between $120 to $130 per tracking share, up from the $l90 per share in cash plus Class C stock in the original offer.
Dell needs the majority of holders to vote in favor of the deal with the vote scheduled for December 11.
Dell shares are up 4% to $102.53. VMware (NYSE:VMW) is up 2.7% to $152.05.
Previously: Report: Dell could increase tracking stock offer (Nov. 7)
Previously: Icahn: VMware worth $300 per share (Nov. 12)
Now read: PDFS: A Potential Turnaround Story »
Subscribe for full text news in your inbox