Dell to Go Private, Give the Money Back to Shareholders

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In a move that some will see as a delicious bit of irony, PC maker Dell is planning on buying back all of its stock from shareholders and going private. The deal will cost some US$24.4 billion and includes a $2 billion loan from Microsoft along with plenty of Apple fans throwing Michael Dell's words back in his face.

Dell buying back its stock and going privateDell buying back its stock and going private

Those words came in the late 1990s when the word "beleaguered" was often said in the same breath as "Apple" when Mr. Dell publicly said he'd shut Apple down and give the money back to the shareholders. While Dell isn't shutting down, the company living up to the rest of his comment.
 
The company confirmed on Tuesday that Mr. Dell and Silver Lake Partners would be buying back all of the Dell's stock with the intent of taking the company private.
 
Word surfaced in January that Microsoft was looking into investing money in helping Dell buy back its stock, and it turns out those reports were accurate. At the time, rumors said Microsoft would be giving Dell between $1 billion and $3 billion, which is exactly what's happening.
 
Microsoft confirmed its $2 billion loan was real, adding "We're in an industry that is constantly evolving. As always, we will continue to look for opportunities to support partners who are committed to innovating and driving business for their devices and services built on the Microsoft platform."
 
The deal still needs the approval of stockholders and will go through the standard regulatory approval process. Mr. Dell is expecting the stock buyback to be completed by the end of the company's second fiscal quarter for 2014.

Comments

Lee Dronick

Well that interesting news.

Mailyn

I think it has to do with their ability to utilize cheaper manufacturing methods.  Without the shareholder pressure they can now move to using factories that utilize child labor, etc.  This will enable them to start undercutting competitor pricing.  That’s what Dell has always been famous for, cheaper pricing.  I never in the past purchased a Dell because it was “quality”.  They may have gotten some awards during their run up but really, for those that remember, it’s always been a priced based company.  Not as bad as say Packard Bell was (or crappard bell), but definitely a cheap ready made product for those people that didn’t know how to make it themselves.

jfbiii

I hope this doesn’t precipitate a worldwide shortage of crow.

palenoue

It would be perfect irony if all those shareholders used their buyout money to purchase Apple stock.

1stplacemacuser

Would love to post the “Ha-ha” meme graphic.

iJack

Wait.  Dell has shareholders?  If that’s the case, don’t bother to give their money back; they’re too stupid to know what to do with it.

Bryan Chaffin

I hope this doesn’t precipitate a worldwide shortage of crow.

Ha! That was awesome, jfbiii. :D

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