Dell Technologies Inc. has announced that private equity firms Francisco Partners and TPG Capital will acquire its Boomi integration platform as a service, or iPaaS, business in a $4 billion deal.

“This proposed transaction positions Boomi for its next phase of growth and is the right move for both companies, our shared customers and partners,” Dell Chief Operating Officer Jeff Clarke (pictured) said in a statement Sunday.

“For us, we’re focused on fueling growth by continuing to modernize our core infrastructure and PC businesses,” the executive added. Selling Boomi should free up more resources for Dell to invest in its core businesses, while providing the company with new capital it could use to pay off another portion of its more than $40 billion debt pile.

Dell took on most of the debt currently on its balance sheet to finance the 2015 acquisition of storage equipment maker EMC Corp., a deal that included the latter firm’s VMware virtualization subsidiary and RSA cybersecurity business. Dell sold RSA in 2020 to a consortium led by private equity firm Symphony Technology Group. Last month, the company announced plans to spin off VMware as well in a $9 billion deal. 

Boomi didn’t become part of Dell through the EMC merger like VMware and RSA, but was acquired in a separate transaction five years prior. Buying Boomi likely didn’t make a big dent in Dell’s balance sheet at the time: Boomi had only raised about $5 million in funding prior to the sale and Dell didn’t disclose the value of the transaction, which usually suggests a limited deal size. 

Under Dell’s wing, Boomi has grown into a major player in the data integration market, with a customer base of more than 15,000 organizations, including many large corporations. Boomi’s iPaaS platform, AtomSphere, makes it easier for companies to share information between their systems of record. Retailers can use AtomSphere to move purchase logs from their e-commerce backends to their sales analytics tools, while healthcare providers rely on the platform to synchronize patient records among internal medical applications.

Boomi’s value proposition is that its software reduces the amount of time required to build data integrations from months to weeks. AtomSphere does so by lowering the amount of coding involved in the process, allowing workers to put together integrations via a drag-and-drop interface rather than an integrated development environment.

Boomi competes in a few adjacent parts of the data management market as well. Besides creating integrations, its software can also used for tasks such as sharing information with a company’s suppliers and building data catalogs.

Francisco Partners, the private equity firm buying Boomi together with TPG Capital, is no stranger to transactions involving Dell subsidiaries. The company in 2016 teamed up with Elliott Management Corp. to acquire Dell’s former SonicWall and Quest businesses. SonicWall sells cybersecurity products such as firewalls, while Quest makes software for managing databases and other information technology assets. 

Quest has made at least four acquisitions to grow its business since it moved under private equity ownership. After acquiring a company, private equity firms often help the leadership team implement new growth strategies to accelerate revenue momentum, which helps the new owners realize a bigger return on their investment.

“We look forward to working with the teams at Boomi and Francisco Partners to accelerate the company’s growth as an independent entity,” said TPG partner Nehal Raj and principal Art Heidrich in a statement.

Dell said the sale of Boomi is expected to close by year’s end. Morgan Stanley & Co. LLC and DBO Partners LLC acted as the company’s financial advisers in the deal.

Photo: SiliconANGLE