Dell’s Pivotal Software Seeks Near $600 Million for its IPO

Silicon Valley-based Pivotal Software, a spin off of Dell-EMC, plans to raise up to $592 million in an initial public offering (IPO) of 37 million Class A shares priced between $14 to $16.

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The San Francisco-based company lists backers such as Michael Dell, Silver Lake Partners, Dell Technologies, EMC, VMWare, General Electric, and Ford Motor. The company announced in an SEC filing on Monday that it will trade on the New York Stock Exchange under the ticker symbol PVTL.

In late March, the software company filed to go public on the same day that online storage and workplace collaboration software company Dropbox hit the public market.

When Pivotal was founded in 1989, it focused exclusively on technology consulting services. In 2012, the firm was bought by data center storage company EMC, and then spun out in 2013 alongside data center software giant VMware. After the spin off, the business began doubling down on building tools for app developers, while providing consulting services for agile software development.

Since 2013, Pivotal has inked a whopping $1.7 billion in funding, with a reported post-money private valuation of $2.8 billion, according to Pitchbook and Crunchbase. The company, which was inherited by Dell Technologies after its buyout of EMC and its federation companies for $67 billion in 2016, offers enterprises its cloud-native platform intended to harness software-developer productivity, reduce operational costs and create an environment for innovation to scale. Serving some of the world’s biggest brands, Pivotal’s platform reaches billions of users every day and is used by millions of developers around the world.

Like many of its enterprise technology peers such as recently public Dropbox and Box, Pivotal has yet to turn a profit, but has encouraged investors through its impressive sales momentum. In the fiscal full year ended Feb. 2, the company posted a 22% year-over-year jump in sales, up from $416 million in 2017 to $509 million. In FY18, Pivotal lost $163.5 billion, an approximate 30% decline from a $232.9 million loss posted the previous year.

Morgan Stanley, Goldman Sachs, Citi, BofA Merrill Lynch, Barclays, Credit Suisse, RBC Capital Markets, UBS Investment Bank and Wells Fargo Securities are joint bookrunners in the deal. Upon Pivotal’s public debut, Dell Technologies will remain the company’s largest stakeholder.