(Reuters) – Dell Technologies Inc (DELL.N) return to public markets on Friday, almost six years after the founder and Chief Executive Officer Michael Dell took it private in what was then the largest buyout since the financial crisis of 2008.
A logo of Dell Technologies is seen at the Mobile World Congress in Barcelona, Spain on February 28, 2018. REUTERS/Yves Herman
The computer maker is trading on the New York Stock Exchange under the symbol “DELL”, after the redeemed shares DVMT.N that tracked the financial performance of the software maker VMware (VMW.N), which Dell held for 81 percent of the shares. The cash-and-stock deal worth nearly $24 billion.
The redemption of the shares allowed Dell to bypass the traditional IPO process, which supposedly involved grilling by investors about the company’s $52.7 billion debt pile.
Dell shares opened at $46 on Friday, marking the market a valuation of $16 billion, per Refinitiv data.
The company was seen as a model of innovation in the early 2000s, pioneering online ordering of custom pcs and working closely with Asian component suppliers and manufacturers to assure rock-bottom production costs.
But it missed the big industry shift to tablets, smartphones and high-powered consumer electronics, such as music players and game consoles later in the decade, and saw sales decline to slightly more than 10 percent in 2012 in the fourth quarter on a decline in shipments.
That forced Michael Dell to take the company off the public market, and look to acquisitions to transform his company from a PC maker into a broader vendor of information technology services, ranging from storage and servers to networking and cyber security.
The strategy is in sharp contrast to that of rivals HP Inc. ‘ s (HPQ.N), which is separated from Hewlett Packard Enterprise Co (HPE.N) in 2016, based on the reasoning that the two technology companies focused separately on hardware and services would be more nimble.
But Dell’s strategy seems to be paying off, especially since companies are more and more one-stop shops” to help them manage their IT infrastructure in the cloud.
Dell reported a 15 percent increase in revenue in the last quarter, and said that it expects total adjusted revenue in the range of $90.5 billion to $92 billion in 2019.
The company currently has 17 percent of the global PC market share year-to-date, behind rival HP Inc. ‘ s (HPQ.N) 23 percent, and Lenovo Group Ltd (0992.HK) 21 percent, according to data from Canalys.
Reporting By Aparajita Saxena in Bengaluru; Editing by Shinjini Ganguli