At first Dell (NASDAQ:
) had only one suitor - company founder, Michael Dell who, along
with Silver Lake Partners says he plans to take the company
private and has offered $13.65 a share.
Then, according to
The New York Times
, Blackstone Group (NYSE:
), Francisco Partners, and Insight Venture Partners, entered the
discussion with an offer of $14.25. At this point, things were
starting to get interesting.
Apparently, playing in the Herbalife (NYSE:
) sandbox isn't as fun as it used to be becausenow, well-known
activist investor, Carl Icahn has skin in the game. Icahn who,
The Wall Street Journal
, also disclosed a 4.6 percent stake in Dell, is offering a $5
billion equity commitment. The offer includes $15 per share,
thereby upping the stakes for both Michael Dell and
Here's the problem: Dell may not be all that great of a
Back in the day (the early 2000s), the company was considered
to be a model of innovation. It pioneered online ordering of
custom-made PCs while still keeping prices low.
Fast forward to Q4, 2012. Dell's slice of the PC market pie
slipped to a little more than 10 percent - down from 12.5 percent
in 2011. Shipments fell 20 percent, according to research house
Although Michael Dell returned as CEO in 2007, he has not been
able to orchestrate a turnaround so far. The company's focus on
corporate computing has not yet yielded hoped for results.
reported a source that said Dell slashed its internal forecast
for fiscal 2013 operating profit to $3 billion - down from the
$3.7 billion it had predicted previously. The source also
indicated that additional details would be revealed in a proxy
filing expected by the end of this week.
So, why is Carl Icahn interested? What does he see that others
Icahn has bought into technology in the past, according to the
. He invested in Yahoo! (NASDAQ:
), when he was unable to talk Microsoft (NASDAQ:
) into buying it. But, having done something in past is not
necessarily a reason to do it again.
Icahn opposed the original Dell buyout, saying it undervalued
the company. As a result he has pushed for a special dividend to
shareholders of $9 a share and more leverage, according to
ZDNet believes Icahn's proposal might damage Dell as a serious
technology player due to the uncertainty brought on by the move.
The website says Icahn won't care. As long as he gets his $9
In early trading, Monday, Dell is up more than 3 percent at
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