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Sunday, February 10, 2013

postheadericon Dell close to $22bn leveraged buyout amid decline in PC market

PC-maker

founder and CEO Michael Dell wants to take the company private in order to focus on providing services

The computer maker Dell may be taken private in a matter of $ 22 billion (? 14 billion) this week that the crisis more PC market power of the largest companies in the world manufacturing technology to move from computer to provide information technology.

Buy

, led by private equity group Silver Lake Management and Dell founder and CEO Michael Dell would be the largest buyout firm since the global banking crisis hit in 2007.

Last year, the number of personal computers Dell shipped to retailers fell by 12% worldwide, and its market value has fallen by a third. The problem is that the entire industry shipments from all manufacturers fell by almost 13 million in 2012 - the first decline since the end of the dotcom crisis in 2001

While sales recovered quickly in the new century, the PC time of the fall seems irreversible. Consumers are turning their attention to tablets and smartphones, and none of the five largest manufacturers of desktop computers have significant activity in these devices.

"Whereas before we imagine a world in which individual users who have both PCs and tablets, increasingly suspect most will spend a tablet personal," said analyst Gartner, Mikako Kitagawa, "Most buyers will not replace PCs in the side of the house, rather than how old they were."

represent 70% of sales from Dell, and more than half of their earnings. If the company wants to survive, it must change its dependence away from the sale of laptops and focus on business services more nebulous that made the success of companies like IBM. Creation and management of servers, software in the cloud, and data center equipment

The agreement is "doable", he believes, because Dell could change the money it pays dividends to meet the interest on the loan needed to take the company private. The result would be "one of the largest LBO LBO [] in history."

To buy Dell, Silver Lake met at least four banks to provide an estimated $ 15 billion in funding, according to Bloomberg. Lenders include Credit Suisse Group, Royal Bank of Canada, Barclays and Bank of America, and the offered price is reported to be between $ 13.50 and $ 14 per share.

News negotiations broke down last Monday, sending shares of Dell, an increase of 18%. They closed at $ 12.84 on Friday night, valuing the company at more than $ 22 billion.
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