The Battle For Dell Is Finally Over

Michael Dell has won the vote to take Dell private in a $25 billion deal. Not sure you can call that a win, given that he’s still the CEO of a PC manufacturing company.

Lucas Jackson / Reuters

Michael Dell has won his battle to take the PC manufacturer he founded private in a deal worth $25 billion, finally ending months of dueling between the founder and billionaire hedge fund manager Carl Icahn.

For the past several months, Dell has been sparring with Icahn over what to do with the company. Dell and Silver Lake Partners wanted to take the company private while it navigates a challenging market where PC sales are declining rapidly in favor of mobile devices. Icahn and Southeastern Asset Management wanted to replace Dell’s board, borrow money, and give stockholders an option of selling some shares back to the company.

Pressure from Icahn inevitably ended up forcing Dell to up his bid to take the company private in exchange for modifications to the voting that would give Dell and Silver Lake the votes they would need to take the company private. The fight was bitter at times, with Icahn trashing Dell and Silver Lake in letters to shareholders and filings with the Securities and Exchange Commission.

“We therefore congratulate Michael Dell and I intend to call him to wish him good luck (he may need it),” Icahn said in a recent letter to shareholders. “While we of course are saddened at our losing the battle to control Dell, it certainly makes the loss a lot more tolerable in that as a result of our involvement, Michael Dell/Silver Lake increased what they said was their ‘best and final offer’. As a result of this increase all stockholders are to receive many hundreds of millions of dollars more than the board originally accepted.”

For what it’s worth, Dell is still the CEO of a company where much of the business is locked up in PC manufacturing as the PC industry continues its slow. Dell will face the challenge of guiding the company to a new directive that likely revolves around enterprise services. But, he won’t have to do it as a public company — which could make keeping employees and key customers a little easier.

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