Technology

Intel's Huge Investment in VMware

$218.5 million in exchange for 2.5% stock ownership

By Alexandru Pancescu, Hardware Editor

10th of July 2007, 07:24 GMT

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VMware, a subsidiary of EMC, announced on July 9, 2007 that Intel Corporation, through its investment arm, Intel Capital, agreed to invest heavily into Vmware. As most of Vmware's virtualization platforms run on Intel architecture and at the same time almost all virtualization solutions from Vmware emulate Intel microprocessors, Intel's interest in investing virtualization in no big

surprise.

Intel Capital will trade $218.5 million for VMware's Class A common stock. At the completion of VMware's initial public offering and upon closing the investment, Intel will own about 2.5% of VMware's total common stock. Translating that into voting power on the Board of Directors, as Intel will appoint an executive too, will result in less than one percent.

Intel's investment is intended to strengthen even further inter-company collaboration and the adopting acceleration of Intel architecture by VMware virtualization systems. In addition, both companies will enter a routine of collaboration around joint development, marketing and industry initiatives. With this new investment, Intel just extends its longtime relation with EMC, which will continue to control VMware.

Just after the completion of the investment, VMware announced the availability of its latest product, Lab Manager 2.5. This new release should help people using VMware Infrastucture 3 to automate software configurations running on multiple machines. A free ROI calendar named VMware Lab Maneger ROI was also launched. This calendar should help predict the potential advantage of using Lab Manager in a particular system configuration.

Among the software firms that showed interest in the new Lab Manager are Borland and Genilogix, which will launch a new series of automated tests for it. The idea of those tests is for users to be able to run them and try out possible applications of VMware's Lab Manager before implementation. A director of marketing from Borland Lifecycle Quality Management, Brad Johnson, said the automated tests will help users cut down "many of the time and cost constraints of multiconfiguration and cross-platform software application testing."

TAGS:

investment | stock exchange | virtualization | VMware | Intel

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