The talks of Dell going private started as early as Feb 2013, and in no much time after strong defense from Icahn and Southeastern Asset Management Company, the second biggest shareholder in Dell, Michael Dell the CEO of Dell announced the completion of it’s acquisition by him alongwith angel venture capitalist Silver Lake partners on Oct 29, 2013 with each shareholder of Dell receiving $13.75 in cash for each share plus a special cash dividend of $0.13 per share. The total acquisition is vlued t approximately $24.9 billiion.
When asked Why go Private Michael Dell supported its act of going private with the following points:-
- Cloud computing, big data, storage and networking are the areas left for growth in the shrinking PC market. With a much lesser pressure of onerous and costly disclosure and compliance requirements to be made to SEC (for being a public company), the privatization will encourage the creativity and confidence of the company and will help focus us on business software and services arena.
- The only person Dell has to reply to now is he himself, under this new structure of ownership Dell will be more liberal in pacing its strategy and save the investments without any pressure of scrutiny and quarterly performance.
Dell’s stock trading at an all- time low also gives Dell this rare opportunity to recapture the entity he once founded. In this time Dell would really be benefitted from being off the stock market and who knows in the coming 3-5 years when Dell will surely be in a much stronger position it may come with another IPO!!
The time is to wait and watch the next move!!