VMware Inc. (VMW) announced Thursday a new stock purchase agreement with Dell Technologies Inc (DVMT). VMware agreed to buy $500 million worth of VMware Class A Common Stock currently held by EMC Corp., a subsidiary of Dell and also VMware’s parent company.

EMC was bought out by Dell earlier this year in a $67 billion acquisition, marking the largest tech deal to date. (See also: What the EMC-Dell Merger Means for VMware.)

Dell says it plans to use the $500 million in proceeds to repurchase the Dell tracking stock for VMware. The $500 million stock purchase is set to be completed during VMware’s fiscal first quarter, which ends May 5. VMware says the stock purchase agreement will have no effect on VMware’s upcoming Q4 fiscal 2016 and full-year 2016 diluted share count and non-GAAP earnings per share.

What’s Next for VMware Under Dell

The recently announced $500 million stock purchase is the only share repurchase plan currently authorized. VMware disclosed in its latest Q3 earnings call a previously authorized $1.2 billion stock buyback completed in early Q4 2016. VMware says it will comment on additional plans for returns of capital to stockholders, if applicable, in its Q4 2016 earnings call set for January.

The Palo Alto, Calif.-based business recently secured a Q3 earnings beat, with non-GAPP earnings of $1.14 on a per-share basis and revenues up 6% to $1.78 billion for the quarter. VMware CEO Pat Gelsinger is reportedly “getting along quite well” with new boss Michael Dell, indicating that the new parent company is fully on board with VMware’s new direction: championing the hybrid cloud space with its headline partnership with Amazon.com Inc. (AMZN). (See also: VMware CEO Confirms Strong Bond With Dell.)


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