Will Blackstone Put A Damper On Silver Lake's Deal With Michael Dell By Making An Offer?

  @angeloyoung_a.young@ibtimes.com on March 19 2013 7:50 AM
Michael Dell
Michael Dell, CEO of Dell Inc. (Nasdaq:DELL). Reuters

The Blackstone Group LP (NYSE:BX) may be jockeying for position to buy Dell Inc. (NASDAQ:DELL), the Round Rock, Texas-based computer maker, by making an offer that would have to beat the $24.4 billion proposal from Silver Lake Management LLC.

If the New York based-private equity firm with a market cap of $11.3 billion makes an enticing offer, Dell’s board might resist a deal that was made between Silver Lake and company founder Michael Dell, because the company’s top shareholders oppose Silver Lake’s offer of $13.65 a share, which is below Monday's closing price. Blackstone and other unnamed investors are mulling the possibility of a bid, according to Bloomberg. They face a Friday deadline, although the board would consider enticing offers after that date.

So far, two tech companies have also examined Dell’s books -- Hewlett-Packard Co. (NYSE:HPQ) of Palo Alto, Calif., and Beijing-based Lenovo Group Limited (HKG:0992) --  though no offer has been made by either so far.

Dell has been hit hard as consumers gravitate away from desktop and laptop PCs and embrace more portable tech. More reliance on cloud computing -- where people store their data online rather than on hard drives -- has also pushed down demand for storage devices. Michael Dell is trying to take the corporation private to re-invent the company he founded in his University of Texas at Austin dorm room in 1984 and was able to expand with a $300,000 loan from his family.

But the company that was once a go-to source for desktop computers at home and in the workplace now trades at around $14 after hitting $8.85 on Nov. 16, its shares' lowest price in 44 months. As recently as 2007, the company’s stock was trading at more than $40. 

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