VMware has entered negotiations to acquire the virtualisation specialist Pivotal in a move that would unite the Dell-owned security firms.
According to a filing submitted to the US financial regulator, VMware would acquire all of Pivotal’s outstanding class A stock at $15 per share, the same price as it was listed when the company went public in 2018.
The share price had fallen to as low as $8 in the months following the listing as shareholders took legal action over the company’s botched Kubernetes support and subsequent lost sales.
Financial statements issued by Pivotal and VMware noted that “there can be no assurances that a definitive agreement will be executed between the two parties”. Under the terms of the cash deal, VMware would also swap all of Dell’s outstanding class B stock for class A VMware shares.
The two companies have formed a close partnership in recent years, with VMware selling Pivotal services to its clients under the Cloud Foundry Foundation. News of the potential merger has pushed the price of Pivotal shares back up to $14.