VMware IPO to Raise $741M, Intel Invests

Virtualization software specialist VMware, Inc. expects to raise about $741 million in its upcoming IPO, with Intel (INTC) investing $218 million and receiving a seat on the company's board of directors, the company said this morning. With virtualization growing in importance as a data center management and cost-cutting tool, VMware's pending IPO is being closely watched in the data center industry.

VMware, which is owned by storage software giant EMC Corp. (EMC), said in a regulatory filing that it expects to sell up to 37.95 million shares to the public for an estimated price of between $23 and $25 per share. VMware said its Class A common stock has been approved for listing on New York Stock Exchange under the symbol VMW.

Intel Capital will pay $23 a share for 9.5 million Class A common shares in VMware, giving it 2.5 percent of all outstanding common stock. Intel said the investment "is intended to foster strengthened inter-company collaboration towards accelerating VMware virtualization product adoption on Intel architecture."