Tech giant Dell Technologies is selling off one of its big divisions as part of re-organizations at the company. The division, in this case, is cloud business Boomi, which it’s struck a deal to sell to two private equity firms.

Details:

• Dell has struck an agreement to sell Boomi to private equity firms TPG and Francisco Partners in a deal valuing the cloud business at $4 billion including debt. 

• Boomi makes software that helps applications communicate on the cloud by sharing data with each other. For example, when a sale recorded by a business on one app needs to be immediately reflected in a tax statement on another app, software like Boomi is crucial to that. 

• Dell bought Boomi, then a small startup, for an undisclosed price in 2010. Now with its sale valuing the business at $4 billion, it’s obvious that Boomi scaled to greater heights under Dell.

• After a major restructuring that began with Dell getting bought out by a group led by its founder Michael Dell in 2013, the company itself has also reached bigger heights compared to its level at the time. Under the leadership of CEO Dell, the company made its landmark $67bn purchase of EMC largely financed by debt in 2015 and used that as a foundation for high growth.

• Dell returned to the public markets in 2018 by buying back shares that tracked the performance of its publicly traded subsidiary VMware. It then recently announced a major reorganization that included divesting from VMware and a few other divisions like Boomi.

• Boomi was originally part of the Dell Software Group division which Dell sold in 2016 to private equity firms but at that time decided to hold on to Boomi. Unsurprisingly, Francisco Partners which’s one of the firms now buying Boomi was also one of the two firms that bought Dell Software Group for a sum of $7 billion.

• The sale of Boomi is expected to be completed this year. 

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