Dell CEO Michael Dell.
Photo by Justin Sullivan—Getty Images
By Jonathan Vanian
October 9, 2015

Dell’s cyber security business unit SecureWorks could be on the verge of going public, according to a report Friday by the Wall Street Journal.

This summer, the security unit filed confidentially for an initial public offering, which could take place by year’s end, the report said, citing unnamed sources. Dell, which acquired the Atlanta-based company in 2011 for $612 million, does not plan to sell its stake in SecureWorks if it goes public.

Rumors of the potential IPO emerged over the summer when Atlanta Business Chronicle reported that Dell was exploring spinning out the cyber security company. At the time, the Chronicle reported that a potential IPO would value SecureWorks at over $1 billion. The Wall Street Journal said, however, that SecureWorks could be worth up to $2 billion if the company were to go public.

The news comes amid a potential blockbuster deal involving Dell buying technology giant EMC (EMC), which has a market value of roughly $50 billion.

EMC operates under what it calls a federation involving six separate business units under one corporate umbrella. However, critics have said the unusual structure is confusing and creates less value for shareholders. Hedge fund Elliott Management, in particular, has urged EMC to separate the companies.

In an interview at Fortune’s Brainstorm Tech conference in July, Silver Lake managing partner and Dell board of directors Egon Durban said Dell was closely studying technology giant EMC and its federation model. At the time, he said Dell had no plans to spin out any business units, but pointed to SecureWorks and Dell’s cloud-software business unit Boomi as possibilities in the future.

The EMC Federation has its own security company RSA Security in its federation. If Dell were to buy all of the EMC Federation and spin out SecureWorks, it’s not clear where that would leave the RSA Security business.

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