Dell to Return Funds to Shareholders in $24 Billion Deal to Go Private

Discussion in 'Mac Blog Discussion' started by MacRumors, Feb 5, 2013.

  1. macrumors bot

    MacRumors

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    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.
    Apple fans have been particularly interested in the fate of Dell since Michael Dell recommended in October 1997 that Apple be shut down.
    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
     
  2. Moderator

    maflynn

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    #2
    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

    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.
     
  3. Megagator, Feb 5, 2013
    Last edited: Feb 5, 2013

    macrumors regular

    Megagator

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    #3
    I wonder what Microsoft wants with Dell.... Maybe finally get into the computer hardware business and sell 100% Windows computers?
     
  4. macrumors 68020

    applesith

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    #4
    I guess Dell didn't get the memo about the Post-PC era.
     
  5. macrumors 65816

    JaySoul

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  6. macrumors 68020

    Squilly

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    #6
    I didn't even know Dell was doing that bad... You see Dell's everywhere. A $2 billion loan says something though.....
     
  7. macrumors regular

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    #7
    Hopefully this will allow them to become more innovative and increase competition.
     
  8. macrumors 68020

    shanmugam

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    #8
    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?
     
  9. macrumors 6502

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    #9
    It's too bad Jobs isn't still around to mass email this info to all employees.
     
  10. Rocketman, Feb 5, 2013
    Last edited: Feb 5, 2013

    macrumors 603

    Rocketman

    #10
    If Apple were to go private today it would be a $550B LBO. Since most shares are not owned by insiders, which is different from Dell, it would be more difficult to go private at all. However it would be possible for Apple and Braeburn to get considerable leverage, both bank and brokerage, buy back its stock in the open market and through dark pools, and make slow progress toward setting up a future go private effort.

    If they were to buy back half the company at stock prices of $450-500 at $275B and assuming 4:1 leverage, the cash cost would be only $55B. Pocket change for Apple and Braeburn.

    Although today's market cap is only $418B. Only 3x cash in bank.

    Rocketman
     
  11. macrumors regular

    Macrolido

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  12. macrumors 68030

    basesloaded190

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    #12
    They are going private, not out of business.
     
  13. macrumors 6502a

    a0me

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    #13
    "I'd shut the company down and give the money back to the shareholders."

    15 years later, Dell finally acted on his own advice.
     
  14. macrumors member

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    #14
    "Silver Lake"

    Silver Lake was the original code name for the IBM AS/400 mid-range computer line. ... Hmmm ...
     
  15. macrumors 6502

    johncrab

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    #15
    This is going to be another deal where the vulture capital firm hollows out and whores out a company, running up huge bills on its credit and then walking away as everything burns. It's just like a scene from "Goodfellas" except this is all legal. It's the beginning of the end for Dell and in six months there won't be a trace of production, support or anything else in the US.
     
  16. macrumors Nehalem

    GoCubsGo

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    #16
    That's a big move, really, and couldn't have been easy at all.
     
  17. macrumors 6502

    johncrab

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    #17
    Yeah, I remember when he said that about Apple. Hehehehe. Payback's a bitch.
     
  18. macrumors 6502a

    Truffy

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    #18
    And
    Yet
    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.
     
  19. macrumors member

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    #19
    I love my Dell laptop, i7 15inch and amd graphics for about £400 :eek:
    They also make great servers

    ----------

    Mass mail info that Dell sell more PCs then Apple? :confused:
     
  20. macrumors 68030

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    #20
    Agreed. Look at what these "expert" analysts did to Apple's last quarter. Their best EVER quarter by some margin, but because they didn't meet the results these "experts" predicted, they suffered massively negative reporting, and a massive drop in sp/market cap.

    It's almost as if these analysts buy shares, over-up the predictions and dump just before announcements.
     
  21. macrumors 6502a

    Muscle Master

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    #21
    I'm gonna go ahead and say it

    Dell is gonna lead the PC market in a few years followed by Lenovo leading in the business sector
     
  22. macrumors 68000

    robanga

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    #22
    Taking the public money to fund the rapid growth phases and then buying it all back once the situation has leveled out. We may start seeing this as more of a trend.

    Really a good move for them and MS. Being public in the market today is a lot harder than it once was.
     
  23. macrumors 68020

    DavidLeblond

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    #23
    I remember when Dell use to make quality PCs. The PCs we've gotten out of them lately at work have been so bad we've had to drop them and go with Lenovo. Even the Dell repairmen that come by comment on how shoddy the quality is.
     
  24. Moderator

    balamw

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    #24
    Isn't that the path that brought Dell here?

    http://en.wikipedia.org/wiki/Dell

    Used to be (pre ~2008) you could get a semi-custom Dell in a matter of days. When I last priced a Windows laptop and looked at Dell it was 7-10 days at best unless you took their default configuration.

    B
     
  25. macrumors 6502a

    ConCat

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    #25
    "Dude, you gotta get Adele"
     

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