Michael Dell will take computer company Dell Inc private in a $24.4
billion (15.5 billion pounds) deal that marks the biggest leveraged
buyout since the financial crisis.
The company's founder and CEO, and private equity firm Silver Lake are paying $13.65 per share in cash for the world's No. 3 computer maker.
The
deal is being financed by cash and equity from Michael Dell, cash from
Silver Lake, cash from Michael Dell's MSD Capital investment firm, a $2
billion loan from Microsoft Corp and debt financing from Bank of America
Merrill Lynch, Barclays, Credit Suisse and RBC Capital Markets.
The parties expect the transaction to close before the end of the second quarter of Dell's fiscal 2014.
News
of the buyout talks first emerged on January 14, although they
reportedly started in the latter part of 2012. Michael Dell had
previously acknowledged thinking about going private as far back as
2010.
The $13.65-per-share
price is a premium of about 24 percent to the average $11 price of Dell
stock before news of the deal talks broke and is far below the $17.61 that the shares were trading for a year ago.
"I
think the key question here is will shareholders approve this deal,
because there is practically no premium where the stock is trading,"
Sterne Agee analyst Shaw Wu said.
Dell shares opened 0.7 percent higher at $13.36 in delayed morning trading.
Dell
has steadily ceded market share in PCs to nimbler rivals such as Lenovo
Group and is struggling to re-ignite growth. That is in spite of
Michael Dell's efforts in the five years since he retook the helm of the
company he founded in 1984, following a brief hiatus during which its
fortunes waned.
While analysts said Dell could be more nimble as a
private company, it will still have to deal with the same difficult
market conditions.
Source: http://www.independent.co.uk/life-style/gadgets-and-tech/news/computer-company-dell-will-become-a-private-company-in-24bn-deal-8482113.html
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