Dell is going private, announcing Thursday that stockholders and
approved a $25 billion buyout by founder Michael Dell, who will take over as
chairman and chief executive. The struggling PC maker now answers to Dell and
his partners, and Dell said Thursday that he believes the company will work
better without having to worry about stock market pressures. As a private
enterprise, with a strong private quality partner, we'll serve our customers
with a single-minded purpose and drive the innovations that will help them
achieve their goals. Dell joined with investment firm Silver Lake Partners to
execute the deal.
Michael Dell has won control of the computer
company he started in an Austin dorm room nearly 30 years ago, buying the beleaguered
PC maker on Thursday from its public shareholders after a months-long boardroom
fight. In the years since its launch, the company has lost its footing as
competitors emerged with cheaper desktop and laptop computers and its core
audience migrated to hand-held devices such as tablets. Dell's stock has lost
more than 25 % of its value for the past 5 years. The company's shareholders
approved a $25 billion sale of the firm to Michael Dell, who partnered with
investment firm Silver Lake Partners to secure the deal. The deal is expected
to close within a few months and must be approved by regulators. Icahn said
that he believed the deal, which offered $13.75 per share for the company,
undervalued the firm and that, despite dropping his own buyout bid, he still
opposed the agreement. The company's profit dropped more than 70 percent during
its most recent fiscal second quarter compared with the same period the
previous year. The International Data Corporation analysis firm projected
Thursday that tablet sales would overtake PCs this holiday season for the first
time. And the firm could apply some of the consumer strategies it used in more
successful times to the business market, said NPD analyst Stephen Baker.
Michael Dell has indicated that the firm may target small or mid-size companies
looking for hardware and server management, a market that has been underserved
by rivals such as IBM,HP and Oracle, Baker said. It's hard to be just a
consumer or client device company. You need both to get scale and leverage