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Michael Dell and Microsoft take Dell private for $24.4 billion

Posted at 05 February 2013 17:01 CEST by Jan Willem Aldershoff

Big news today as Michael Dell and a group of companies have bought Dell for $24.4 billion which means the company will be private again. The deal is financed by Michael Dell himself, his investment company, a private equity firm, several bank and a $2 billion loan from Microsoft . Dell’s market shares have been decreasing the last couple of years due to intensified competition in the PC market.  The deal is one of the largest financial transactions in the technology industry of the last few years.

By taking the company private Michael Dell will be able to be more flexible in managing the company. Dell is trying to broaden it’s focus from PCs. The company is also trying to market software and services but despite all effort still 70% of its revenues come from the sales of hardware.

With the buyout the company has less pressure from the stoc kmarket which gives more time and freedom to reinvent itself. The involvement of Microsoft is interesting, the company has stated to be interested in developing its own hardware. The company already as its own Surface tablets, keyboards and mice.

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There are 6 comments

ChristineBCW
MyCE Die Hard
Posted on: 05 Feb 13 18:05
    Michael responded to one shout-out: "No, I'm not going back to PCs LIMITED, either. I think the market has enough limits without putting my L-T-D on it again."
    DukeNukem
    MyCE Resident Commenter
    Posted on: 05 Feb 13 18:05
      PCs aren't selling because hardware caught up to software a long time ago. Even PCs from 3 years ago are more than adequate for 95% of what people do. Unless you're a hardcore gamer or need the horsepower (video conversion, Photoshop), most people don't feel the need to constantly upgrade.
      ChristineBCW
      MyCE Die Hard
      Posted on: 05 Feb 13 18:17
        Duke, "caught up with" and, truly, HW specs haven't changed significantly in years. Multi-cores are the rage but the prospects of 128-bit OSs died out a decade ago, after the rather quick ascension of 32s then 64s.

        I want to believe that we've reached some CPU-hardware limit - perhaps cooling issues - and that's why we haven't seen 6 and 8gz CPUs by now. We hit 4gz years ago with old Pentium single-cores (was it the 478 sockets? I get too many model numbers in my head to recall).

        And that because of this hardware limit, Intel & Pals decided to opt to multi-cores since they couldn't wring out substantially more speeds without meltdowns using the current substances. ("Melts in your socket, not in your hands" was a slogan, I understand, that Intel refused to take public. Odd, huh? Gee - I heard some notebooks had no such problem melting in your hands, though. Ah well, that's a different story.)
        UTR
        MyCE Resident
        Posted on: 05 Feb 13 18:44
          It will be interesting to see what MS's angle is in this deal.
          debro
          Blown to smitherines
          Posted on: 05 Feb 13 21:07
            Quote:
            Originally Posted by DukeNukem
            PCs aren't selling because hardware caught up to software a long time ago. Even PCs from 3 years ago are more than adequate for 95% of what people do. Unless you're a hardcore gamer or need the horsepower (video conversion, Photoshop), most people don't feel the need to constantly upgrade.
            in my little office, we have taken to the idea of just upgrading hdds/ssds for our desktop machines, rather than replacing the entire pc.
            Apart from the rare psu dying, and semi regular hdd dying, we haven't had any major hardware breakdowns in the 10 years I've worked there.
            TSJnachos117
            MyCE Senior Member
            Posted on: 06 Feb 13 00:14
              I've only had to make a few hardware changes to my PC, but for the most part, nothing's changed. Heck, the slowest part of it is the HDD, which is no slower than most modern disk-based hard drives.

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