Greene's delivering

What better way for VMware to celebrate its audacious 101% quarterly sales growth rate than with that starlet of the dot-com era: the spin-off stock offering to "unlock shareholder value." VMware's parent company, EMC, will sell 10% of VMware, led by president Diane Greene, in a public stock offering by early summer. EMC acquired VMware in 2004.

Spin-offs and their variants got a bad rap because of companies like Staples, which, like a number of retailers, cashed in on e-commerce fever by selling stock in its online operations. Staples ended up buying its tracking stock back.

VMware's no charlatan. It's the market-share and innovation leader in the important virtualization segment (see story, "The Reality Of Going Virtual"). Yet to stay ahead of rivals, it must invest in tools like its recent beta system to run Windows in a virtual machine on an Apple Mac. Plus, EMC CEO Joe Tucci says VMware needs neutrality, since it works with the server groups of IBM and Hewlett-Packard, which compete with EMC in storage.

Technically, this a carve-out, since EMC's selling a sliver of VMware. And spin-offs and carve-outs have outperformed the market, says Joe Cornell of Spin-Off Advisors.