Shares in computer technology company Dell (NYSE: DELL) rose nearly 10% in expanded trading after the company announced plans to spin off its 81% stake in enterprise software maker VMware.
VMware will collectively distribute a cash dividend of between $ 11.5 billion and $ 12 billion to Dell shareholders, the company said in a statement. Dell will receive $ 9.3 billion to $ 9.7 billion, which will position it well for investment grade ratings, the company said.
Dell currently has a BB + rating from S&P Global, which gives the company a speculative note, according to S&P Capital IQ. The deal will close in the fourth quarter of 2021.
Upon completion of the transaction, Dell shareholders will receive 0.44 shares of VMware stock …