Dell: unreliable privatization

Dell successfully completed generous privatization transactions makes it even harder. Not only the major investment banks and PE have a spoiler, Dell Dell Latitude D620 Battery largest external shareholder Southeastern Asset Management Company (hereinafter referred to as the "Southeastern Asset") is also a critical moment at the foot to trip.

Foreign media reported that Southeastern Asset Tuesday holds 8.4% of the shares of Dell Dell has publicly opposed the privatization. The reason is jointly launched by founder Michael Dell and Silver Lake Capital $ 24.4 billion leveraged buyout offer flawed, Dell also failed to fully prove that the shareholders should accept the offer of $ 13.65 per share.

In addition to the offer against Michael Southeastern Asset privatization offer another private equity giant Blackstone Group and activist investor-owned by Carl Icahn voted against it.

Each has showstopper

In fact, this is not a Dell encounter first openly "fired." Accepted for long-term bet on Dell's southeast assets privatization program, it means to accept the price from $ 40 to $ 13.65, "slip Waterloo". Therefore, insiders said the southeast assets "defection" is not surprising.

Recently, Dell has also received two alternative proposed acquisition of the Blackstone Group, and Carl Icahn.

Currently, the U.S. billionaire Carl Icahn holds about 80 million shares of Dell stock, including a total value of $ 5,000,000,000 equity commitments. Dell Inspiron 15R N5010 battery Icahn raised Dell's stock to $ 15 per share, a total of $ 2 billion acquisition of the other shareholders, and additional cash equity financing of $ 2,000,000,000; existing shareholders will be entitled to a 1:1 ratio of the hands of equity converted into the new Dell the company's equity, or converted into cash at $ 15 a share, all shareholders will receive $ 15.65 billion the highest addition to Icahn. If all eligible shareholders Icahn's offer, Icahn, and its partners will hold approximately 24.1% of the new Dell stock.

Of investors led by Blackstone Group raised willing to Dell acquired for $ 14.25 per share, the existing shareholders will have the opportunity to continue to hold office in the Board of Directors. Previously there is news that Blackstone hope the new Dell "regime change", intends to recruit a new chief executive officer for Dell, Mark Hurd, president of Oracle [microblogging].

Foreign media, The Blackstone Group is in talks with a number of technology companies jointly bid Dell's financial services business. The business is to provide customers with loans to buy Dell products, as well as to extend the lease of Dell products business. The acquisition of equity financing, debt financing, or a combination of both.

Into a founder of the Blackstone Group, and Carl Icahn tripartite contention Dell faces an uncertain future, the Southeastern Asset attitude more brings more uncertainty to the future of Dell. Analysts said, many Wall Street investment bank consulting and financial participation in the Dell privatization transactions salivate, because it can bring them a total of $ 400,000,000 in revenue. According to the Wall Street financing trading rules, banks provide loans only to the final buyer, Dell Inspiron 6400 battery to be able to get a lucrative financial costs. Led banks including Bank of America, Barclays Bank, Credit Suisse and the Royal Canadian banks are expected every bank will receive about $ 67 million in revenue for the transaction. In addition to the lead bank, Deutsche Bank, UBS, and Morgan Stanley is also involved in the transaction. In addition, the foreign media, said Dell to provide services, JP Morgan, Evercore Partners and Goldman Sachs will receive approximately $ 60 million of consulting fees.

Privatization double-edged sword.

In fact, closely related to the interests of most investors and shareholders Dell business situation and prospects in this area seem to be more worrying.

More than a dozen years ago, Dell is the first to open up the online computer customization and purchase, and close co-operation with the Asian parts supplier, in order to ensure the lowest cost of production. This was considered an innovative model. However, in the mobile Internet terminal market, Dell has missed opportunities. Dell also announced the end of last year, to give up the smart phone business in the world. Tablet PC, Dell has not released a Tablet PC.

At the same time, the rapid decline of the PC field gave Dell a serious blow. The fourth quarter of last year, Dell's net profit was $ 530 million, a year-on-year decline of 31%; revenues of $ 14.314 billion, a year-on-year decline of 11%. The entire previous fiscal year, Dell's net profit of $ 2.372 billion, down 32% compared to the previous year; revenue of $ 56.94 billion, down 8% compared with the previous year. Gartner data also show that the fourth quarter of 2012, Dell's PC shipments fell 21%. Currently, Dell's PC market share has dropped to fourth place, ranking HP [microblogging], Lenovo, Acer [microblogging].

IDC released earlier this year, the global smart connected device overall market share ranking, covering this in the list of the three equipment sales of PC Dell FK890 Battery, mobile phones and tablet PCs, Samsung [microblogging] and the breakdown of one, two apples, Lenovo ranked third, Dell even five rafts.

In this competitive environment, Dell had to again in transition. Dell China has repeatedly stressed that the "First Financial Daily", 2013, Dell in the world, and China will continue to strengthen the ability of end-to-end solutions provider.

However, Dell started to PC certainly will not easily give up their stakes. Dell senior early in China, told reporters that Dell's transformation channels continue to rely on the PC business foundation. To this end, Dell will not only not reduce the PC scale, but also by increasing the proportion of low-end products to expand market share.

However, the high profits of the enterprise services market at this stage is occupied mainly by IBM [microblogging], Hewlett-Packard, Oracle, and other vendors. These companies not only provide more comprehensive hardware and software solutions, custom R & D capabilities. Dell does not have such strength.

The problem now is that investors may not agree with privatization can help Dell turnaround. One analyst told reporters that privatization will enable Dell putting a heavy debt, Dell xps m1530 battery making it a large-scale acquisition of action slowed down. As investment bank Sterne Agee analyst Shaw Wu wrote in a report to investors: "no publicly traded stock will make Dell more difficult to expand large-scale acquisition, because it must be the most cash used to repay debt interest.

Another possibility is that, under funding pressure, Dell will sell the cash flow business while retaining the high-margin business, or split a high-margin business, its packaging similar to enterprise-class IT companies such as IBM, EMC, re-seek listing .

Privatization may be able to buy some time for the decline of the giant, but is unlikely to reverse all predicament. Say, from the current situation, the Dell privatization success is still a question mark.