As EMC Corp. prepares to move off the stock exchange in order to join up with the privately-held Dell Inc. as part of the record-breaking $67 billion merger they announced last month, its fastest growing division appears to be headed in the opposite direction. Well-placed insiders have leaked word that the companies intend to sell a minority stake in Pivotal Inc. to public investors sometime next year.

EMC has flirted with the idea of putting up the division on the stock exchange long before the deal was announced and Michael Dell personally confirmed that the plans haven’t changed since in an interview last month. But both parties have been careful not to provide any specifics about the upcoming public offering, most notably the number of shares that will go on sale.

Today’s leak places the figure at around 20 percent, slightly more than the amount of VMware Inc. stock that EMC Corp. put up for grabs in 2007. Yet although the financial details may be similar, the underlying motives are not. Whereas the decision to sell a minority stake in the virtualization giant was aimed at appeasing shareholders, Pivotal’s public offering has an entirely different party in in mind: Dell’s creditors.

The company had to take on $50 billion in debt to finance the merger with EMC that could acquire a proportionally massive amount of interest over time if left unchecked. The capital from the offering will enable Dell to pay down the loan faster and thus free up more money for its competitive efforts. But exactly how much faster very much remains to be seen.

The insiders that leaked the details of the move said the Pivotal stock will be sold under the JOBS Act, which provides regulatory relief to companies generating under one billion dollars in annual revenue. The division’s relatively modest top line makes it likely that the offering won’t account for the lion’s share of the “tens of billions of dollars”  Dell hopes to shed in the next two years, which means that industry watchers should keep an eye out for more bold gambits from the executive. 

Photo via theCUBE