Dell Shareholders Approve $25 Billion Buyout By Michael Dell & Silver Lake To Go Private

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After battling Carl Icahn, Michael Dell has successfully been able to buy back his company (with the help of private equity firm Silver Lake) and take it private.  Michael has bet his own fortune on Dell going private and succeeding again. Michael Dell hopes to refocus the company without the pressures of shareholders and make innovate PCs and get more into the mobile business.  Microsoft has invested $2 billion in Dell to help finance this deal. Let’s take a look at Dell’s history:

1984

Michael Dell, 19 years old, starts a computer business, at first called PC’s Limited, as a pre-med freshman at the University of Texas at Austin

1985

The company designs its first computer, the Turbo PC, featuring an Intel 8088 processor running at 8MHz with a 10MB hard drive and a 5.25-inch floppy drive.

1988

The company, now known as Dell, holds an initial public offering, raising $30 million and valuing itself at about $85 million.

1989

Dell introduces its first laptop, the 316LT. It weighs about 15 pounds with the battery.

1992

At 27 years old, Mr. Dell now heads a company that makes the Fortune 500 rankings.

1995

Dell’s shares approach $100 before a two-for-one stock split.

1996

Dell becomes an early pioneer as an Internet retailer in the electronics industry, launching a website. Six months later, the company is making $1 million in sales per day through the site.

1997

Dell ships its 10 millionth computer.

2000

Dell becomes number one in world-wide market share among computer makers for the first time.

2003

Dell begins expanding into other product lines, including printers and consumer electronics, such as the Dell Digital Jukebox music player.

2004

Mr. Dell steps down as chief executive, handing the job to Kevin Rollins. The company founder stays on as chairman.

2006

Hewlett-Packard overtakes Dell as the largest personal-computer manufacturer as Dell’s growth slows.

2007

Mr. Dell returns as chief executive.

2009

Dell buys Perot Systems for $3.9 billion, one in a string of acquisitions the company makes to get beyond the slumping personal-computer market.

2010

Dell unveils the Streak tablet, which it later discontinues because of weak demand.

2012

Dell explores going private as its profits and stock price shrink.

Feb 5 2013

Dell agrees to be acquired by its founder, Mr. Dell, and private-equity firm Silver Lake Partners in a $24.4 billion deal. Shareholders will receive $13.65 a share in cash. Mr. Dell will continue to lead the company as chairman and chief executive. The buyout represents the heft of Mr. Dell, Microsoft, Silver Lake Partners and a handful of investment banks.

Mar 6, 2013

Southeastern Asset Management Inc., Dell’s largest independent shareholder and the loudest critic of the $24.4 billion deal since it was announced, has weighed whether to attempt a counter-bid, people familiar with the matter said. Southeastern, with 8.4%, has also considered whether to try to join a deal to take the company private while retaining an ownership stake.

Mar 25, 2013

Dell confirms that it is has received alternative takeover proposals from financier Carl Icahn, who has a 4.6% stake in Dell, and Blackstone Group. Mr. Icahn’s firm had earlier entered into a confidentiality agreement with Dell that allows the firm to look at Dell’s books. Mr. Dell risks losing his CEO job if a rival bidder wins

Apr 18, 2013

Blackstone ends its pursuit of Dell, less than a month after the private-equity firm said it would try to top a leveraged buyout by the computer maker’s founder and a rival investment firm. Blackstone’s offer would have kept part of the company in the hands of public shareholders.

May 2013

Mr. Icahn and Southeastern Asset Management Inc. propose an alternative, offering to give Dell shareholders the option to keep holding stock in the company, and take an additional $12 a share in cash or stock.

July 8, 2013

Institutional Shareholder Services, a leading shareholder-advisory firm, recommends that Dell stockholders vote in favor of the $24.4 billion effort to take the computer maker private. The recommendation improves the odds of Mr. Dell’s buyout winning approval. The firm also strongly criticizes Mr. Icahn’s proposal, which envisions borrowing money to pay out shareholders rather than use such funds for a buyout.

July 18, 2013

Dell’s shareholder meeting is adjourned until July 24, a signal that the company didn’t think it had the votes to pass its proposed $24.4 billion sale to Michael Dell and Silver Lake.

July 24, 2013

Mr. Dell and Silver Lake revise their buyout offer for the company, raising it by 10 cents a share and making the new bid conditional on a change in how the vote is counted. The shareholder vote on the deal is delayed again until Aug. 2.

Aug 1, 2013

Mr. Icahn files a lawsuit against Dell and its board to prevent the computer-maker from further delaying a vote or changing the voting rules for a proposed buyout by Dell’s founder.
Aug 2, 2013
Mr. Dell and Silver Lake reach a new deal with Dell’s board to increase the per-share price and include a special dividend for shareholders in exchange for a modification of voting rules. The new pact delays the shareholder vote until Sept. 12.
Sept 9, 2013
In a newly released letter, Mr. Icahn throws in the towel in his fight to stop Mr. Dell from buying out Dell Inc. Although Mr. Icahn still opposes the deal, he concedes that it would be ‘almost impossible to win the battle’ and he compares the company to a dictatorship.
Sept 12, 2013
Michael Dell succeeds.
Source: WSJ


About Author

Suril is a scientist, journalist and obsessive Microsoft observer. He holds an advanced degree in Biotechnology with minors in Biochemistry, Microbiology, and Molecular Biology. Send him tips on twitter: http://www.twitter.com/surilamin

  • Yuan Taizong

    Dell build the company, let him have it.

  • Guest

    Now Dell can come back to what it was and to continue build nice looking PCs and Laptops.
    All of their new XPS PCs or Laptops has great looking and build quality. You an’t find betetr than XPS series in maPC market.

  • tomakali

    Now Microsoft should buy Dell and Blackberry and Merge it as DellBerry and concentrate on Enterprise Market

  • NegLewis

    Dell Laptops were the best.
    Now, IF you must clean the Fans or change the Keyboard or RAM…HDD… you better equip yourself with Lots of patience, coffee and some lite … pills.

    I need a Dell laptop (easy to clean, update, REbuild) and a SLIM tablet (8-10″).
    Focus on build quality and Hardware features.

  • donzebe

    This is good for the Dell, now the company can concentrate on building good devices and services instead of being distracted by share holders whose focus is in their pockets.