Dell’s shareholders approve plan to go private
Dell to escape the ‘tyranny of the shareholder’ and go private in $25-billion deal. The restructured company will focus on providing high-margin enterprise products and services.
Michael Dell and a herd of creditors led Dell to become a private company today, as shareholders approved the group’s $25-billion deal to take the world’s third biggest PC maker private.
“I am pleased with this outcome,” Michael Dell said in a press release. “As a private enterprise, with a strong private-equity partner, we’ll serve our customers with a single-minded purpose and drive the innovations that will help them achieve their goals.”
Shareholders cast their votes at an annual general meeting in Austin Thursday morning, and the buyout is expected to be finalized before the end of Dell’s third fiscal quarter. As per the deal, each shareholder will receive $13.88 per share, slightly above the current market price of $13.85. Reports show that the deal was approved by a majority of shareholders, not just a simple 50 percent plus one.
This deal was vocally opposed by activist shareholder Carl Icahn, who said that the deal would undervalue the company and deny it opportunities to grow. Dell postponed the shareholder vote twice as Michael Dell thought that Icahn would push the vote away from his takeover plan.On Monday, however, Icahn said to the press he was abandoning his campaign to block the deal.
Dell’s desperation to diversify his namesake company away from simply being a PC manufacturer amplified last month, as the company reported a 72-percent decline in quarterly earnings. Various industry consultancies are reporting that the PC market will continue to decline quarter-over-quarter, which would be a vicious occurrence to a company like Dell that is so heavily invested in PCs.