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Virtualization giant VMware, which is preparing to launch an initial public offering, is now looking to sell its stock to the public for as high as $29 per share, according to an Aug. 9 filing with the U.S. Securities and Exchange Commission.
In the filing, which amended the companys prospectus for the IPO, VMware executives wrote that the initial price for the companys stock is now estimated between $27 and $29 a share. The company originally estimated shares at $23 to $25 when it announced the IPO earlier this year.
The filing, which is fueling speculation that the IPO could come as early as Aug. 13, also reported that the New York Stock Exchange has approved a listing for VMware. The stock will be traded under the symbol “VMW.”
When the IPO does launch, VMware, based in Palo Alto, Calif., plans to sell 33 million shares to the public. Of that amount, EMC, which owns VMware, will buy 26.5 million shares and will also control a separate class of stock. All together, EMC will still control about 87 percent of the company.
In its filing, VMware estimated that it could raise about $866.2 million from the IPO if its stock sells for $28 a share. It will use some of the cash to pay down a debt of $350 million to EMC. The IPO will also allow VMware officials to buy back the companys headquarters from EMC and to make several capital investments in their business.
In July, EMC reported its second-quarter revenues, which found that VMwares revenues for the period that ended June 30 were $296.8 million, compared with $156.4 million during the same time period in 2006.
Click here to read more about EMCs latest financial results.
VMwares IPO has been a major topic of conversation for months, and a successful public launch of the companys stock could help propel virtualization—the ability to run multiple operating systems or applications on the same piece of hardware—into the mainstream.
In the last month, two major IT companies—Intel and Cisco Systems—announced that they separately would purchase large shares of VMware. Intel Capital is investing $218.5 million in VMwares common stock at $23 per share, which means that it will own 9.5 million shares.
Click here to read eWEEKs review of VMwares Fusion for the Mac.
For its part, Cisco is buying 6 million shares of the common stock at $25 a share for a total investment of $150 million.
In addition to the stock that is sold with the IPO and investment by companies such as Cisco and Intel, a portion of VMwares shares will be set aside for its employees.
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