Dell Will Spin Off VMware, Unwind Part of Biggest Tech Deal (2)

Dell Technologies Inc. said it will spin off its stake in VMware Inc., creating two publicly traded companies and raising cash to pay down debt. Its shares jumped on the announcement.

The spinoff will unwind, at least in part, a consolidation created five years ago in Dell’s $67 billion acquisition of VMware’s parent, EMC Corp. The spending spree helped Dell branch out from its origins as a personal computer maker, but left the company saddled with debt.

VMware will distribute a special cash dividend of $11.5 billion to $12 billion to shareholders at the close of the deal, which ...