US COMPUTER maker Dell will go private in a $24.4bn deal that also involves Microsoft and private equity firm Silver Lake, the parties said on Tuesday.
Company founder and CEO Michael Dell and Silver Lake are paying $13.65 per share in cash for the world’s third-largest computer maker. The deal is being financed by cash and equity from Mr Dell, cash from Silver Lake, cash from Mr Dell’s investment firm MSD Capital, a $2bn loan from Microsoft and debt financing from four banks.
The transaction is expected to close before the end of the second quarter of Dell’s fiscal 2014.
News of the buyout talks first emerged on January 14, although they were reported to have started in the latter part of last year.
Mr Dell had previously acknowledged thinking about going private as far back as 2010.
The price of $13.65 per share is a premium of about 24% to the average price of $11 per share at which Dell stock traded before news of the deal talks broke, and far below the $17.61 that the shares were trading for a year ago.
Dell has steadily ceded market share in PCs to nimbler rivals such as Lenovo and is struggling to reignite growth. That is in spite of Mr Dell’s efforts in the five years since he retook the helm of the company he founded in 1984, following a brief hiatus during which its fortunes waned.
Dell shares were halted at the market opening on Tuesday.