Pivotal Software (PVTL) to be acquired by VMware (VMW) for $15 per share

Pivotal Software (PVTL) to be acquired by VMware (VMW) for $15 per share.

 

VMware (VMW) signs definitive agreement to acquire Pivotal Software for $11.71 blended price per share; $15 cash per share for public stockholders (enterprise value of $2.7 bln)

VMware will acquire Pivotal for a blended 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 (DELL), at an exchange ratio of 0.0550 shares of VMware Class B stock for each share of Pivotal Class B stock. 

Under the terms of the transaction, Pivotal's Class A common stockholders will receive $15.00 per share cash for each share held, and Pivotal's Class B common stockholder, Dell Technologies, will receive ~7.2 million shares of VMware Class B common stock, at an exchange ratio of 0.0550 shares of VMware Class B common stock for each share of Pivotal Class B common stock. This transaction, in aggregate, results in an expected net cash payout for VMware of $0.8 billion. The impact of equity issued to Dell Technologies would increase its ownership stake in VMware by approximately 0.34 percentage points to 81.09% based on the shares currently outstanding. VMware currently holds 15 percent of fully-diluted outstanding shares of Pivotal. The transaction is expected to be funded through cash on the balance sheet, accessing short-term borrowing capacity, and ~7.2 million shares of VMware Class B common stock to Dell. Closing of the transaction is subject to customary closing conditions including the approval of the merger agreement by the holders of at least a majority of the outstanding shares of Pivotal common stock not owned by VMware or Dell Technologies or their affiliates and is expected in the second half of VMware's fiscal year 2020, which ends January 31, 2020.

** charts before **  

Pivotal Software (PVTL) reported earnings on Tue 4 June 19 (a/h)

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Pivotal Software beats by $0.02, reports revs in-line; guides JulQ EPS in-line, revs below consensus; reaffirms FY20 EPS guidance, guides FY20 revs below consensus

• Reports Q1 (Apr) loss of $(0.03) per share, excluding non-recurring items, $0.02 better than the S&P Capital IQ Consensus of ($0.05); revenues rose 19.3% year/year to $185.72 mln vs the $184.12 mln S&P Capital IQ Consensus.
• Co issues guidance for Q2 (Jul), sees EPS of $(0.04)-(0.03), excluding non-recurring items, vs. ($0.03) S&P Capital IQ Consensus; sees Q2 revs of $185-189 mln vs. $197.5 mln S&P Capital IQ Consensus.
• Co issues guidance for FY20, reaffirms EPS of $(0.15)-(0.13), excluding non-recurring items, vs. ($0.14) S&P Capital IQ Consensus; sees FY20 revs of $756-767 mln vs. $802.53 mln S&P Capital IQ Consensus and vs prior guidance of $798-806 mln.

Pivotal Software (PVTL) reported earnings on Thur 14 March 19 (a/h)

** charts before earnings **

** charts after earnings **

Pivotal Software beats by $0.02, reports revs in-line; guides Q1 EPS in-line, revs below consensus; guides FY20 EPS in-line, revs below consensus

• Reports Q4 (Jan) loss of $0.07 per share, $0.02 better than the S&P Capital IQ Consensus of ($0.09); revenues rose 27.0% year/year to $169.2 mln vs the $170.21 mln S&P Capital IQ Consensus.
• Subscription revenue was $112.5 million, an increase of 50% year over year.
• Subscription customers increased 18% year over year to 377.
• Dollar-based net expansion rate of 149%.
• Co issues guidance for Q1, sees EPS of ($0.06)-($0.05) vs. ($0.05) S&P Capital IQ Consensus; sees Q1 revs of $183-$185 mln vs. $189.94 mln S&P Capital IQ Consensus.
• Co issues guidance for FY20, sees EPS of ($0.15)-($0.13) vs. ($0.14) S&P Capital IQ Consensus; sees FY20 revs of $798-$806 mln vs. $814.42 mln S&P Capital IQ Consensus.

Pivotal Software (PVTL) reported earnings on Wed 12 Sept 18 (a/h)

** charts before earnings **

 

** charts after earnings **

Pivotal Software beats by $0.03, beats on revs; guides Q3 EPS in-line, revs above consensus; guides FY19 EPS above consensus, revs above consensus 

• Reports Q2 (Jul) loss of $0.06 per share, $0.03 better thanthe S&P Capital IQ Consensus of ($0.09); revenues rose 30.5% year/year to $164.4 mln vs the $158.12 mln S&P Capital IQ Consensus.
• Subscriptions customers grew 19% year over year to 354 in Q2.
• Dollar-based net expansion rate was 150%.
• Operating cash flow for the quarter was $18.4 million compared to negative operating cash flow of $56.5 million in Q2 of last year.
• Co issues guidancefor Q3, sees EPS of ($0.09)-($0.08) vs. ($0.09) S&P Capital IQ Consensus; sees Q3 revs of $163-$165 mln vs. $162.89 mln S&P Capital IQ Consensus.
• Co issues upside guidancefor FY19, sees EPS of ($0.36)-($0.34) vs. ($0.38) S&P Capital IQ Consensus; sees FY19 revs of $647-$653 mln vs. $646.52 mln S&P Capital IQ Consensus.

Pivotal Software (PVTL) reported earnings on Tue 12 June 18 (a/h)

** charts before earnings **

 

** charts after earnings **

** The following day **

Pivotal Software beats by $0.03, beats on revs; guides Q2 EPS in-line, revs above consensus; guides FY19 EPS above consensus, revs above consensus 

• Reports Q1 (Apr) loss of $0.10 per share, $0.03 better than the Capital IQ Consensus of ($0.13); revenues rose 28.5% year/year to $155.7 mln vs the $140.41 mln Capital IQ Consensus.
• PVTL added 20 net new subscription customers from 4Q18 for a total of 339 subscription customers in Q1.
• Dollar-based net expansion rate was 156%.
• Co issues guidancefor Q2, sees EPS of ($0.10)-($0.09) vs. ($0.10) Capital IQ Consensus Estimate; sees Q2 revs of $157-$159 mln vs. $152.81 mln Capital IQ Consensus Estimate.
• Co issues upside guidancefor FY19, sees EPS of ($0.39)-($0.37) vs. ($0.45) Capital IQ Consensus Estimate; sees FY19 revs of $642-$649 mln vs. $622.03 mln Capital IQ Consensus Estimate.

PVTL : 6-week performance

Pivotal Software (PVTL) began trading on the NYSE on 20 April 2018

Pivotal Software, Inc. is a software and services company that accelerates and streamlines software development and modernizes legacy applications.
The enterprise cloud computing company has been majority-owned by Dell, which came about after its merger with EMC in 2016. It was spun off from Dell, EMC and VMware in April 2013. After that, it raised $1.7 billion in funding from Microsoft, Ford and General Electric.

• Headquarters: San Francisco, California
• Parent organization: Dell Technologies
• Number of employees: 2,518 (2017)
• pivotal.io
• Losses for fiscal 2018 stood at $163.5 million, improved from negative $232.5 million seen in 2017 and $282.5 million in 2016.
• Priced IPO at $15; raised $555 million

In the S-1 filing, Pivotal acknowledged that it faces competition from “legacy application infrastructure and middleware form vendors” like IBM and Oracle. The company says it additionally competes with “open-source based offerings supported by vendors” like RedHat. Pivotal also faces challenges from SAP Cloud Platform, Amazon Web Services and Microsoft Azure.