Build it up and break it down. Laughing all the way to the bank no doubt. Dell/EMC portfolio next?
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Did y'all actually listen to the Dell Tech investor call? Silver Lake and MD are keeping majority stakes in VMware, and MD is still on the board of VMware. This way they still get to take in the superior cash flow of the software business at a tax advantaged status, AND on paper, move to keep Dell and VMware culture clashes to a minimum. Dell Tech doesn't seem to be giving up a single thing in practice because MD stays in charge. There's even a 5 year renewable agreement for how Dell and VMware plan to keep working together.
Someone please explain how this isn't a logical cash transfer from the stronger VMware cash flow to restore Dell's credit rating once the tax policy is favorable, while Dell is still getting all the software IP benefits in the immediate future as Hybrid plus SaaS storms the market?
Without VMWare, dell has no value as a company, selling off the most profitable portion of the business is short sighted and debt will consume the company. Especially after the quickly upcoming changes to debt take hold. You would think Dell would have learned to rely on a hardware based sales environment.
More software IP to come, hardware focus, hardware strategy.
From a sales strategy play I actually welcome this move. VMware has always pretended it was too good for Dell and their culture in sales isn't great. They will scuttle an entire deal just to try and sell more of their software.