Dell Going Private? Report Could Add Billions To Unhappy Shareholders

Dell Private Deal Could Be Biggest Computer Takeover Since Compaq

 @DavidZie on January 14 2013 3:29 PM
Dell
Unless a higher bid emerges, Dell will soon become a private company, managed by Michael Dell and Silver Lake Partners. Reuters

A report that Dell (NASDAQ: DELL), the No. 3 PC maker, might be considering a management buyout sent its share surging 18 percent Monday after Bloomberg News suggested two private equity firms were considering it. A similar report sent shares surging a month ago.

The news came after Gartner (NYSE:IT) released its 2012 final report that showed PC sales fell last year. Representatives of Dell, in Round Rock, Tex., had no comment on the report.

The PC company, which under founder Michael S. Dell, 47, has been moving more into storage, software and services, might welcome a buyout to give it time to complete its transformation. Dell personally owns 16 percent of the equity, which would make it easier for the company to make a deal.

In late Monday trading, Dell shares eased back to $12.40, up $1.52 or 14 percent, after jumping as high as $12.83 earlier. Still, they are down 22.6 percent for the past 52 weeks.

The company’s market capitalization is now $21.4 billion, so a takeover that would presumably leave Dell in charge of the company he founded as a University of Texas undergraduate, would be the largest computer deal since Hewlett-Packard Co. (NYSE: HPQ) took over Compaq Computer in 2001.

 

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