“It looks like Michael Dell is trying to steal his company from public shareholders,” Andrew Bary writes for Barron’s. “The big question is whether he will get away with it.”
“The markets seem to be saying that Michael Dell will be able to pull off the $24.4 billion buyout deal approved by the board this morning. Dell (ticker: DELL) shares now trade around 13.38, up 11 cents on the session, but below the buyout price of $13.65 in cash announced this morning,” Bary writes. “If investors figured that Dell would have to increase the price to get shareholder approval, the stock might be trading above the deal price.”
Bary writes, “Wall Street, however, may be underestimating the potential shareholder opposition to the Dell buyout. The price equates to just eight times projected profits of $1.65 a share in Dell’s fiscal year ending in January 2014. The effective P/E is closer to six when Dell’s net cash of $5 billion, or $3 a share, is factored in. No major company has ever gone private at such a low price during the past decade… It’s maddening to some shareholders that Michael Dell’s leadership contributed to the sharp drop in the share price and now he is using that weakness to try to buy out public shareholders at what looks like a very low price.”
Read more in the full article here.
MacDailyNews Take: Or maybe the majority of DELL shareholders will be happy to just get something out of beleaguered Dell in a post-PC world versus being left holding the bag.
Related articles:
Dell gives the money back to the shareholders, goes private in $24.4 billion deal – February 5, 2013
Michael Dell bristles when his beleaguered PC company is compared with mighty Apple Inc. – February 4, 2013
Apple now worth 38 times Dell’s market value – October 3, 2012
yeah, sure.
Since MDN coined this acronym, I’d hope that they could get it right: SIDAGTMBTTS
Oh, and it would be cool if MDN would update their app to support the iPhone 5. It’s getting a bit old looking at the black bars at the top and bottom of the screen, four months after its release. I thought MDN was pro-Apple, but the only change I’ve noticed with the app over the last four months is more obnoxious ads.
. . . and the ability to increase the font size. (like the AppleInsider app does) They have had years to fix that.
MDN does give use the options of small and smaller.
Obnoxious ads are how MDN pays the bills. I know that it is not very classy and Apple like but they have not been able to attract better advertisers. I personally will only click on the Apple related ads but I have to admit that I use AdBlock and Click to Flash to avoid the plethora of awful ads here.
Agreed
Why not just view MDN it in mobile safari? if you want the notifications for new articles just subscribe to their twitter feed and push the notifications for that feed.
I also wish MDN would update for the additional screen real estate on the iPhone 5, but even moreso, I wish they would add ‘pull to refresh’. I constantly attempt this out of habit and then remember I need to tap the small refresh button instead. It’s so counter-intuitive to the iOS interface!
Please MacDaily put the picture of Michael Dell up. I could use a pick-me-up today.
Market manipulation again. Note that a few weeks ago Dell was trading at $8.60, so that in less than 4 years Dell would make its value back in income. Even with the pending implosion of the PC market it is very unlikely that this makes economic sense.
This has to be a disguised buyout with a meg-company made to look like a bank & Mr. Dell led deal.
Can’t believe that this is anything other than Mr. Ballmer lurking in the background with options to buyout the other players, if and when Ballmer see an opportunity.
MS can then become vertically integrated just like his nemesis Apple.
“…It’s maddening to some shareholders that Michael Dell’s leadership contributed to the sharp drop in the share price and now he is using that weakness to try to buy out public shareholders at what looks like a very low price.”
Not a fan of M Dell, but their terrible business was not some ploy on his part. He’s going to drive it even further into the ground – time to get out with at least some $
Hudsucker Proxy?
Can you really steal something nobody wants?
Stealing? More like paying far more than it’s worth. Any Dell shareholder who objects to this is an idiot.
-jcr
Who cares?
Now we just need RIM to go down.. FUd won’t work so well when the competition is drying up and dying.
Investors will not be disappointed to have the stock off their hands. Better to sell now than hold on for another lap around the toilet bowl.
How do you steal garbage?
$13 is what I bought my Apple Stock for many years ago.
To do what? Mac more Mac clones?