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Dell Confirms and Details Rival Bids From Blackstone and Icahn
DavidGilbert99 writes "Dell has confirmed it has received 'two alternative acquisition proposals' from billionaire investor Carl Icahn and the world's largest equity firm Blackstone. These bids rival the $24.4 billion offer made by co-founder Michael Dell and equity firm Silver Lake last month, who want to take the company private. Dell also confirmed details of the two offers, with both exceeding Michael Dell's original offer of $13.65 per share, with Blackstone offering $14.25 and Icahn offering $15 per share."
That is what everybody said about Apple when Steve Jobs came back.
And the reason why Michele wants to take Dell private is so he can do some radical things to it. So who knows? Give the man the benefit of a doubt, grab some popcorn, and see what happens - assuming Michele get the company.
.... Apple is one of the most popular brands ever and that's because it re-invented itself. Dell has a shot at re-branding itself with the right leadership.
I hope they do and are successful once again.
Life takes interesting turns, but the most interest is when you're off the beaten path.
And the reason why Michele wants to take Dell private is so he can do some radical things to it. So who knows? Give the man the benefit of a doubt, grab some popcorn, and see what happens
He's already CEO and Chairman. If he can take the company in new profitable directions, then there's no incentive for the other shareholders to sell because they they'd be giving up their shares just before they become more valuable. Their only sensible choice is to get as much money as possible for the shares now, since, if it goes private, they'll never be able to own part of Dell again.
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No story mentions that. He certainly doesn't have 26.8B dollars. Is it a bluff to get the dividends he wanted?
your thin skin doesn't make me a troll
But he was still forced to do things the way Wall Street and the stockholders wanted. Take it private and you have more leeway to do things that might be profitable long term rather than short term.
The only thing necessary for evil to triumph is for it to be pitted against a slightly greater evil
Replying to myself as I can't edit posts: there's a much better write-up at Ars: http://arstechnica.com/business/2013/03/dells-game-of-thrones-icahn-blackstone-make-rival-bids-for-company/ The key part that's missing in the IB Times: how Icahn plans to finance the takeover. Here it is: "Icahn's group would put up a total of $5 billion in cash and equity in Dell as part of the deal, spend $7.4 billion of Dell's cash-on-hand, collect $1.7 billion by financing against Dell's outstanding accounts receivable, and add $5.2 billion in new debt to the company's ledgers."
In other words, Icahn gets a loan for $5B, spends over $7B of Dell's own cash and takes out two separate loans against Dell's assets for another $8B. In further other words, the only people who would benefit from the deal are current stockholders who think that making an extra 50 cent a share now is a good thing. Everyone else, including employees, will be handed a Dell that will be significantly worse off.
Those who can, do. Those who can't, sue.
I don't know what his plans might be, but there's a world of difference between publicly traded and privately held companies. There are a whole slew of constraints on what a public company can do, between regulations and notions of 'fiduciary duty'. Not to mention the obligatory lawsuits every time the stock price dips. I think we can expect to see more and more companies going privately held when large changes need to be made.
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Witness first hand the attempted destruction of a large American company. These bids aren't serving anyone's interest except a select few. (Despite claiming to be for "shareholder interest")
If any of these parties get hold of Dell, the company will be dead inside a few years. Assets stripped, loaded with debt, pensions and retirement plans raided, thousands laid off. Sound familiar? Yeah, it does. Because you've seen it happen hundreds of times if you read the news.
Something is broken. Why is there so much money to be made by destroying companies, jobs, and livelihood? Why is it legal?
How long before we resort to publishing the personal details, addresses of corporate raiders and mailing them to the millions who have lost their jobs and had their retirements stolen? While vigilante justice isn't a solution, it is a failure mode. And failure is what is happening here.
Vulture capitalism at it's finest. Are leveraged buyouts ever a good idea for anyone other than the "management company" that rapes and pillages the public company? Why is it legal to take a loan out on a company using it's own capital reserves as payment?
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Apple develops their own CPUs?
Do you mean the Motorolas, the PowerPCs (a consortium of apple, ibm, and motorola. That's two experienced chip designers and apple.), or do you mean the current Intel CPUs?
Well, that's it for their computers. I actually have no idea what their portable istuff uses, but I'm rather doubtful it's something they developed. Considering their standard method of obtaining 'cutting edge tech' they either bought and exclusive contract with the developer/manufacturer, or they bought the company itself.
Apple designers have always been great, their engineers don't fall into that category.
I know, the apple fanboys are going to go ballistic over this criticism of their god and savior, and honestly, I don't care.
While I hate LBOs as much as the next person (in fairness probably even more), I expect Dell's shareholders to want that extra 50c and to damn the company and its employees. Unless you're both an employee and a shareholder... the plan is to take the shares off of your hand, why would you care what happens to the company afterwards? The Board of Directors is responsible to shareholders, not employees. Rationally, they'd probably vote for Dell to get gutted. Yay, unbridled capitalism.
It's not so much legal as it is a built-in calculation in the offer-sheet. Yes, someone will officially have to tender the full asking price for the company, but the billions that Dell has in cash aren't counted as risk in the loan. Instead, the new owner will immediately use the cash to pay off part of the loan, which of course would have been structured to have the company as collateral. Even if the company isn't collateral, you can't prevent the owner of a company to do whatever they want with the cash in accounting. Yes, it's soulless, but that just goes to show what kind of people engage in LBOs.
Those who can, do. Those who can't, sue.
Their portable istuff uses ARM SoCs designed by Apple (they've bought up P.A. Semi, Intrinsity, and a couple other fabless semi companies in the past few years). ARM (the company) was a joint venture between Acorn and Apple back in the Newton days.
Do you even lift?
These aren't the 'roids you're looking for.
Yes. In order to imitate Apple he needs to take company private just like Apple did ... oh wait
That was a different situation. When Jobs returned to Apple, the shareholders understood that the company was in deep doo-doo and radical changes were needed. So Jobs had a lot of leeway.
Dell, OTOH, is doing okay in terms of short term profit (PE is around 8). It probably needs some radical changes for the long term because the market it moving away from Dell's strengths. But there is no shareholder consensus about this. As long as it is a public company, different shareholder factions will be pulling in different directions, and any strategy will be a muddle. As a private company, they can set a clear and decisive strategy and stick to it.
Uhhh...has anybody looked at the actual numbers? Both sales and profits are already back to pre 2008 levels, the company is firing on all cylinders frankly the ONLY thing that hasn't gone up is the stock price which considering how distorted the market is right now really isn't surprising and I would say should be expected. I just hope they keep Icahn the fuck away from it as that corporate raider has a history of destroying companies but Michael is just being smart, he sees the numbers and sees the stock is undervalued and is going for it, can't say as I blame 'em.
ACs don't waste your time replying, your posts are never seen by me.