Dell Considering Possible IPO Options

Dell Technologies Inc. is considering strategic options including a public stock offering, according to people familiar with the matter, as the corporate-technology company looks for ways to increase revenue and raise funds.

The U.S. computer maker is exploring a range of options that could see the world's largest privately held technology company grow further through acquisitions or going public.

Dell's board of directors will hold a meeting later this month to consider the biggest shakeup in the company's history since it acquired data storage provider EMC Corp for $67 billion in 2016.

The Round Rock, Texas-based company, headed by its founder Michael Dell, is under pressure to lift its profitability after the EMC deal failed to deliver the cost savings and performance it projected, while higher manufacturing costs have eroded its margins.

Dell took his company private in 2013, when he collaborated with Silver Lake Management LLC on a leveraged buyout. That freed Dell to cut costs and work to become a bigger supplier of hardware and software for corporate data centers without the quarterly investor scrutiny that comes with being a public company.

Three years later, Dell acquired storage-technology provider EMC Corp. and its majority stake in data-center software vendor VMware, taking on a massive debt load to seal the $67 billion deal.

Raising cash could help the company further expand or pay off some of the debt. Dell Technologies has about $46 billion of debt that includes about $3 billion of bonds maturing in 2018 and $4.35 billion due next year while the company also has loans outstanding.

Dell is now reviewing a list of several possible acquisition targets that would boost its cash flow and expand its offerings.

It is also considering a sale or IPO of its faster growing software unit, Pivotal Software Inc. It may also consider a transaction with its majority-owned VMware Inc, a public virtualization software maker.

Dell and VMware were not immediately available for comment, the sources said.

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