Intel discloses 12.6% stake in VMWare

By Colleen Taylor, Contributing Editor -- Electronic News, 9/4/2007

In an indication of the importance with which the leading chipmaker values the future of virtualization technology, Intel Corp. disclosed today in an SEC regulatory filing that it owns a 12.6 percent stake in virtualization software developer VMWare Inc.

The filing indicates that Intel's stake in VMWare is nearly five times larger than the 2.5 percent investment that Intel had previously been thought to control. VMware's base virtualization platform virtualizes the Intel architecture, and the majority of systems on which its products are deployed are Intel-based. Intel has said its investments in VMWare are aimed to "accelerate adoption of virtualization products on Intel architecture and reinforce the value of virtualization technology."

VMWare's star has been on the rise for months now, as virtualization technology proves more and move lucrative to maximize the potential of data centers' power and efficiency. Earlier this month, the company held its initial public offering (IPO) at $29-a-share, some 17 times more than the $635 million that EMC Corp. paid in 2004 to buy the company. This morning, the company's stock opened at $69.06 per share, more than doubling its IPO price.