Computer maker Dell to go private in US$24.4 bil. deal
By Poornima Gupta ,ReutersComputer maker Dell Inc. will go private in a US$24.4 billion deal that also involves Microsoft Corp. and private equity firm Silver Lake, the parties said on Tuesday.
February 6, 2013, 12:03 am TWN
Company founder Michael Dell and Silver Lake are paying US$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 investment firm MSD Capital, a US$2 billion loan from Microsoft and debt financing from four banks.
The transaction is expected to close before the end of the second quarter of Dell's fiscal 2014.
News of the buyout talks first emerged on Jan. 14, although they were reported to have started in the latter part of 2012. Michael Dell had previously acknowledged thinking about going private as far back as 2010.
The US$13.65-per-share price is a premium of about 24 percent to the average of US$11 price at which Dell stock traded before news of the deal talks broke and is far below the US$17.61 that the shares were trading for a year ago. 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.
JPMorgan and Evercore Partners were financial advisers, and Debevoise & Plimpton LLP was the legal adviser to the special committee of Dell's board. Goldman Sachs was financial adviser, and Hogan Lovells was legal adviser to Dell.
Dell shares were halted at market open Tuesday.