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Old Feb 5, 2013, 09:11 AM   #1
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Dell to Return Funds to Shareholders in $24 Billion Deal to Go Private




Dell today announced that it is officially going private in a $24.4 billion deal that will see the company owned by founder Michael Dell and investment firm Silver Lake Partners. The deal also involves a $2 billion loan from Microsoft.
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"Michael Dell is a true visionary and one of the preeminent leaders of the global technology industry," said Egon Durban, a Silver Lake Managing Partner. "Silver Lake is looking forward to partnering with him, the talented management team at Dell and the investor group to innovate, invest in long-term growth initiatives and accelerate the company's transformation strategy to become an integrated and diversified global IT solutions provider."

Following completion of the transaction, Mr. Dell, who owns approximately 14 percent of Dell's common shares, will continue to lead the company as Chairman and Chief Executive Officer and will maintain a significant equity investment in Dell by contributing his shares of Dell to the new company, as well as making a substantial additional cash investment.
Apple fans have been particularly interested in the fate of Dell since Michael Dell recommended in October 1997 that Apple be shut down.
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"What would I do? I'd shut [Apple] down and give the money back to the shareholders," Michael Dell said before a crowd of several thousand IT executives.
At the time, Dell was surging to become the world's top-selling PC manufacturer, but it has since faltered and now stands as the third-largest manufacturer as HP and Lenovo now battle for the top spot.

Today's move is of course far from a shutdown for Dell, but Apple fans may take a certain pleasure in seeing the company turn private and return funds to shareholders as it continues its efforts to revitalize the Dell brand in a stagnant PC market.

Article Link: Dell to Return Funds to Shareholders in $24 Billion Deal to Go Private
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Old Feb 5, 2013, 09:12 AM   #2
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Dell goes private - got a 2 billion loan from MS

While it was no secret, since word hit the streets a couple of weeks ago, its still quite shocking to see.

Hopefully they'll turn it around. I hate to see any company fail; We're talking about people's livihoods and their ability to support their families.

From Engadget

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The rumors were true. Dell has announced that it will go private, assisted by a $2 billion loan from Microsoft. The full deal between stockholders, Michael Dell and investment firm Silver Lake is being valued at around $24.4 billion.
I wonder what the terms of the loan are and what's MS' expectation. Rumors were swirling that Dell was going to push harder into the Linux sector perhaps now they'll focus more attention on windows since MS lent them a boat load of money.
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Old Feb 5, 2013, 09:16 AM   #3
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I didn't even know Dell was doing that bad... You see Dell's everywhere. A $2 billion loan says something though.....
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Old Feb 5, 2013, 10:18 AM   #4
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I didn't even know Dell was doing that bad... You see Dell's everywhere. A $2 billion loan says something though.....
It's not about revenue, it's about profits.
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Old Feb 5, 2013, 10:15 AM   #5
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Originally Posted by maflynn View Post
While it was no secret, since word hit the streets a couple of weeks ago, its still quite shocking to see.

Hopefully they'll turn it around. I hate to see any company fail; We're talking about people's livihoods and their ability to support their families.

From Engadget



I wonder what the terms of the loan are and what's MS' expectation. Rumors were swirling that Dell was going to push harder into the Linux sector perhaps now they'll focus more attention on windows since MS lent them a boat load of money.
I don't get the MS angle either, Xbox aside, Microsofts attempts at hardware have been less than awe inspiring....Perhaps they feel that riding Dell will help to reinvigorate them in some way, but I'd sure like to see the terms of that loan too.
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Old Feb 5, 2013, 10:19 AM   #6
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Originally Posted by Macman45 View Post
I don't get the MS angle either, Xbox aside, Microsofts attempts at hardware have been less than awe inspiring....Perhaps they feel that riding Dell will help to reinvigorate them in some way, but I'd sure like to see the terms of that loan too.
I think this:

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Originally Posted by maflynn View Post
Rumors were swirling that Dell was going to push harder into the Linux sector perhaps now they'll focus more attention on windows since MS lent them a boat load of money.
has a lot to do with it. Losing the locked in sales of OSes to the #3 PC manufacturer would be a big blow that even MS could not absorb so easily.

IIRC it has happened before. At one point Dell was pushing Linux on their netbooks and MS came in with a lower license cost.

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Old Feb 5, 2013, 12:28 PM   #7
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Originally Posted by balamw View Post
Losing the locked in sales of OSes to the #3 PC manufacturer would be a big blow that even MS could not absorb so easily.
I think the number of PCs sold is quite independent of what any individual manufacturer does. If Dell stopped selling PCs today, all the others would sell more PCs. Very few people would not buy a PC because Dell stopped selling. If Dell stopped buying Windows licenses, the other manufacturers would buy more licenses.
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Old Feb 5, 2013, 12:33 PM   #8
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Originally Posted by gnasher729 View Post
I think the number of PCs sold is quite independent of what any individual manufacturer does. If Dell stopped selling PCs today, all the others would sell more PCs. Very few people would not buy a PC because Dell stopped selling. If Dell stopped buying Windows licenses, the other manufacturers would buy more licenses.
I think you missed the point. It's about Dell continuing to actively sell PC hardware, but promoting them as Linux boxes and not including an OEM Windows license by default.

e.g. Dell's entire lineup of lower end machines become Chromebooks or Ubuntu boxes.

Right now, Chromebooks are manufactured and promoted by lower tier hardware manufacturers like Acer and Samsung. If HP, Lenovo or Dell jump on the bandwagon it's not good for Microsoft.

EDIT: Uh-oh http://www.forbes.com/sites/rogerkay...to-look-legit/

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Old Feb 5, 2013, 09:14 AM   #9
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I wonder what Microsoft wants with Dell.... Maybe finally get into the computer hardware business and sell 100% Windows computers?

Last edited by Megagator; Feb 5, 2013 at 09:24 AM.
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Old Feb 5, 2013, 09:15 AM   #10
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I guess Dell didn't get the memo about the Post-PC era.
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Old Feb 5, 2013, 12:16 PM   #11
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I guess Dell didn't get the memo about the Post-PC era.
There is no such thing as the post-PC era. Anyone who believes that doesn't understand computers. It's not that people don't want or need computers but rather the fact that computing power has increased to the point where upgrade cycles are extremely long now. That is the reason for the sales slump the market has been in.

Gone are the days where upgrades provide dramatic performance improvements. The PC boom was happening when the internet was the driving force for those upgrades. An 5-8 year old computer is enough for what the vast majority of people do with one today.

These incremental upgrades are going to catch up to the phone and tablet market too in a few years and people are not going to need them as often. A few years after that the second hand market will be flooded with completely capable cheap devices and those markets will slump as well.
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Old Feb 5, 2013, 01:42 PM   #12
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Originally Posted by TMar View Post
There is no such thing as the post-PC era. Anyone who believes that doesn't understand computers. It's not that people don't want or need computers but rather the fact that computing power has increased to the point where upgrade cycles are extremely long now. That is the reason for the sales slump the market has been in.

Gone are the days where upgrades provide dramatic performance improvements. The PC boom was happening when the internet was the driving force for those upgrades. An 5-8 year old computer is enough for what the vast majority of people do with one today.

These incremental upgrades are going to catch up to the phone and tablet market too in a few years and people are not going to need them as often. A few years after that the second hand market will be flooded with completely capable cheap devices and those markets will slump as well.
Who thinks post-pc actually means PCs are done with? I thought it was implied how consumers and businesses are moving towards purchasing other devices more frequently. Clearly people aren't throwing out their PCs or not replacing them. I think you take the "post-pc" phrase too literally.
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Old Feb 6, 2013, 01:19 PM   #13
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Originally Posted by TMar View Post
There is no such thing as the post-PC era. Anyone who believes that doesn't understand computers. It's not that people don't want or need computers but rather the fact that computing power has increased to the point where upgrade cycles are extremely long now. That is the reason for the sales slump the market has been in.

Gone are the days where upgrades provide dramatic performance improvements. The PC boom was happening when the internet was the driving force for those upgrades. An 5-8 year old computer is enough for what the vast majority of people do with one today.

These incremental upgrades are going to catch up to the phone and tablet market too in a few years and people are not going to need them as often. A few years after that the second hand market will be flooded with completely capable cheap devices and those markets will slump as well.
I flatly disagree. I believe the reason for the slump is that most people don't use traditional computers beyond the basic functionality that a tablet can provide. In other words, people are using tablets and smartphones more.

I think you are mistaken in saying that people that refer to the Post-PC era don't understand computers. I think that it is you who don't understand consumers. Apple, Google, and their tablets (and smartphones) do, and are laughing all the way to the bank. Sales figures of tablets vs PCs seem to reflect this.
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Old Feb 5, 2013, 09:16 AM   #14
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Dell should hire Adele for a commercial.
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Old Feb 5, 2013, 09:17 AM   #15
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Hopefully this will allow them to become more innovative and increase competition.
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Old Feb 5, 2013, 09:01 PM   #16
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Hopefully this will allow them to become more innovative and increase competition.
In what way? Competition with whom?

Dell's original innovation was all about supply chain, I'm not sure we can expect a lot from this company, or any others just like it, other than to build more of the same things year after year (with only minor tweaks over last year's myriad models).
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Old Feb 27, 2013, 04:39 AM   #17
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Hopefully this will allow them to become more innovative and increase competition.
Who Dell??

Chuckle chuckle chuckle
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Old Feb 5, 2013, 09:18 AM   #18
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Job losses

I do not really care about apple vs Dell fight.

not sure how many going to lose their jobs; is it good or bad?
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Old Feb 5, 2013, 09:25 AM   #19
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I do not really care about apple vs Dell fight.

not sure how many going to lose their jobs; is it good or bad?
They are going private, not out of business.
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Old Feb 5, 2013, 09:30 AM   #20
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"I'd shut the company down and give the money back to the shareholders."

15 years later, Dell finally acted on his own advice.
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Old Feb 5, 2013, 09:47 AM   #21
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"I'd shut the company down and give the money back to the shareholders."

15 years later, Dell finally acted on his own advice.
And
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Originally Posted by johncrab View Post
Yeah, I remember when he said that about Apple. Hehehehe. Payback's a bitch.
Yet
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They are going private, not out of business.
That's the point, they're not closing down, simply freeing themselves of the analyst whores who do nothing but expect more. Good luck to them.
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Old Feb 5, 2013, 12:29 PM   #22
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They are going private, not out of business.

Oh how the mighty have fallen

Yea, and if you think public owned companies are not a picnic, try one that gets raped by private equity ownership. SilverLake Partners ain't the Boy Scouts and will turn Dell upside down, shake the $$ out of its pockets, install every efficiency that does or does not make sense and scoop a big chunk of change at the end when they spin Dell out/sell/discard it as half the organization they once were.

Been there, done that, lived through it. Shi*t sandies for lunch boys and for many months to come. If you work there, exit, go quickly. Life as you know it is.....OVER!

The Dell ship has sailed and their train has left the station never ever to return!
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Old Feb 5, 2013, 09:19 AM   #23
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It's too bad Jobs isn't still around to mass email this info to all employees.
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Old Feb 5, 2013, 09:24 AM   #24
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This is worth a moment of reflection today.
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Old Feb 5, 2013, 10:11 AM   #25
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Dell should hire Adele for a commercial.
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