Sept. 12 - Shareholders approved Michael Dell's $25 billion bid to take control of the company he founded in his college dorm room. Fred Katayama reports.
Michael Dell finally can claim victory after shareholders approved his $25 billion bid to take Dell private. This ends the founder's 7 month battle along with ally Silver Lake Partners to take control of the PC company he founded in his college dorm room. After three postponements of the buyout vote, the outcome became clear this week when activist investor Carl Icahn withdrew his hostile bid due to court rulings that he said made it impossible for him to win. Dell prevailed after raising his initial bid last month, so shareholders, including Icahn, will walk away with more money on paper. The onus is now on Michael Dell to prove that he can do better in private what he couldn't do in public: revive the fortunes of what was once the world's largest PC maker that has slipped to third and boost its services and software business. And he'll have to do that as demand for PCs continue to shrink. IDC reports that tablets, an area where Dell is weak, will surpass PC sales in the fourth quarter this year and on a full-year basis in 2015. S&P says that falling demand and competition will put pressure on Dell's growth. It downgraded Dell's debt to junk status. The company is taking out a $5.5 billion loan to back his leveraged buyout, the second largest LBO loan this year amid a pickup of M&A deals.