Dell has announced a deal that will allow the company to go private and Microsoft will soon become a significant stakeholder in the private company.
It will cost Dell $24 billion to go private and they will pay $13.65 per share which is about a 25% premium on the stock from when word first broke about the possible deal.
By going private, Dell will no longer have to deal with quarterly earnings reports and can now focus on the long-term without having the hear the cries of shareholders who are looking for short-term gains. Under the deal, Michael Dell is contributing his nearly 16% of the company to make the transaction possible.
Microsoft had the following to say about the loan that is making this transaction possible:
Microsoft has provided a $2 billion loan to the group that has proposed to take Dell private. Microsoft is committed to the long term success of the entire PC ecosystem and invests heavily in a variety of ways to build that ecosystem for the future.
“We're in an industry that is constantly evolving. As always, we will continue to look for opportunities to support partners who are committed to innovating and driving business for their devices and services built on the Microsoft platform.”
Dell’s board on Monday night approved the deal and we will be curious to see if Acer's CEO fires a few friendly phrases at Microsoft seeing as he thought building the Surface was a bad idea.