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VMWare Stock Up on Plan to Buy Infrastructure Software Firm

TheStreet logo TheStreet 9/29/2020 Dan Weil
VMWare Stock Up on Plan to Buy Infrastructure Software Firm © TheStreet VMWare Stock Up on Plan to Buy Infrastructure Software Firm

Shares of VMware , the cloud-computing major controlled by Dell Technologies , said Tuesday it would buy SaltStack, the Lehi, Utah, maker of infrastructure automation software.

Terms weren't disclosed.

VMware recently traded at $144.72, up 1.2%. The stock has eased 4% year to date.

"So, why is SaltStack important to VMware's customers?" Alex Wang, VMware's vice president of corporate development, asked rhetorically in a statement.

"Because time is money and speed is the new currency for digital transformation, VMware works hard to give customers a fast and simple path to cloud for their VMware-based workloads."

VMware's customers "can automate infrastructure across clouds with VMware vRealize, and the next logical step was to enable more seamless onboarding and better cross-cloud orchestration with configuration management," Wang said.

"This is what we are getting with SaltStack. [The company] will allow us to deliver full-stack automation from infrastructure to applications with the ability to do software configuration inside VMs and containers."

SaltStack has a great open-source community, and VMware will continue to grow it, Wang said.

"While our strategy has been one of supporting best-in-class choice of supporting configuration management, we believe many customers will want something simple and integrated."

In July Dell said it was "exploring" a spinoff of VMware. Dell owns an 81% stake in the company.

"Although this exploration is in an early stage, Dell Technologies believes a spinoff could benefit both Dell Technologies and VMware … by simplifying capital structures and creating additional long-term enterprise value," the company wrote. "Any potential spinoff would not occur prior to September 2021."

This article was originally published by TheStreet.

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