If you have VMware vCenter – Click Migrate
For those of us who do not have VMware vCenter:
1. Shutdown the VM
2. SSH to the ESXi machine and type:
vmkfstools -i /vmfs/volumes/datastore1/NAME-OF-VM/NAME-OF-VM.vmdk /vmfs/volumes/datastore1/NAME-OF-VM/NAME-OF-VM-thin.vmdk -d ‘thin’ -a lsilogic
Once the copy is done, go into the settings of your VM, delete the hard disk, and add a new hard disk pointing to the �thin� vmdk you created. Boot your vm, if it all works then you can use the datastore browser to delete the thick vmdk and you are done.