VMware to Acquire Pivotal Software at $2.7 Billion valuation

VMware announced its agreement to acquire Pivotal software.

VMware will pay price per share of $11.71, comprised of $15 per share in cash to Class A stockholders, and the exchange of shares of VMware’s Class B common stock for shares of Pivotal Class B common stock held by Dell Technologies, at an exchange ratio of 0.0550 shares of VMware Class B stock for each share of Pivotal Class B stock, the announcement notes.

The announcement said, "In total, the merger consideration represents an enterprise value for Pivotal of  $2.7 billion. "

Popular Spring developer framework contributor, Pivotal provides a set of assets including a leading developer-centric platform, tools, and services that accelerate modern app development. The company recently launched Pivotal Spring Runtime for Kubernetes and planning to launch Pivotal Application Service for Kubernetes.

Executive Opinion

CEO of VMware, Pat Gelsinger, said, "Kubernetes is emerging as the de facto standard for multi-cloud modern apps. We are excited to combine Pivotal’s development platform, tools and services with VMware’s infrastructure capabilities to deliver a comprehensive Kubernetes portfolio to build, run and manage modern applications. Importantly, adding Pivotal to our platform, accelerates our broader Any Cloud, Any App, Any Device vision and reinforces our leadership position in modern multi-cloud IT infrastructure."

CEO of Pivotal, Rob Mee, said, "The time is ideal to join forces with VMware, an industry leader who shares our commitment to open source community contributions and our focus on adding developer value on top of Kubernetes. VMware has a proven track record of helping organizations run and manage consistent infrastructure in support of mission critical applications, and our two companies have already built a strong foundation on our successful VMware PKS collaboration. We look forward to continuing our work with VMware to provide even more value to customers building modern applications."

VMware and Kubernetes

In February 2018, Pivotal and VMware collaborated to launch VMware Pivotal Container Service (PKS), known to be the most comprehensive portfolio, helping customers with the on-premises development of Kubernetes. The acquisition of Pivotal will help VMware to deliver the most comprehensive enterprise-grade Kubernetes-based portfolio for modern applications.

With a focus on multi-cloud, in November 2018, VMware acquired of Heptio, a company leading in the open Kubernetes ecosystem, for an undisclosed sum.  Heptio was known for its proven expertise and leadership in Kubernetes and will only result in the tighter integration of Kubernetes in the enterprise environment.

Recently, VMware acquired Bitnami, an application packaging company with a large number of click-to-deploy applications and development stacks for major cloud and Kubernetes environments.