The proposed 50-50 joint venture, which was announced on Oct. 20 after Dell said it was buying EMC for $67 billion, wasn’t popular with VMware’s shareholders and baffled most analysts. VMware’s shares have dropped by close to a third after the joint venture was announced.
“VMware will now continue to operate the VMware vCloud Air business, focused on helping customers seamlessly extend their data center applications to the cloud,” the company wrote in an email to SDxCentral. “VMware also continues to deliver cloud software and solutions to cloud providers through VMware’s vCloud Air Network.”
Last month, EMC reportedly got cold feet in regards to the Virtuestream joint venture. As for Dell, it wants to create a VMware tracking stock as a means to fund its acquisition of EMC, but the value of that tracking stock has been hurt by VMware’s declining shares.
VMware will update its 2016 forecast during next month’s fourth-quarter earnings report to reflect the absence of Virtustream. During its third-quarter earnings call, VMware said that the joint venture with Virtustream would lead to an operating loss of $200 million to $300 million in 2016.
In the same Monday filing, VMware announced that former Accenture chief financial officer Pamela Craig and former Cisco chief financial officer Dennis Powell resigned from its board of directors. Donald Carty, the former CEO of American Airlines’ parent company, AMR, joined the board. Carty is also on the board of EMC.