Deals

Blackstone just backed out of its proposed Dell buyout

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michael dell

Dell has been dodging a takeover for months now, but the latest interested buyer, Blackstone Group, has just backed away from the table due to the PC industry’s rather grim outlook.

The pullout was confirmed by a letter from Blackstone to Dell and other parties with a stake in the deal that rescinded the bid due to lagging PC sales and Dell’s own financial slide.

For the first quarter of 2013, PC shipments went down the proverbial toilet. Sales posted a 13.9 percent drop globally — the industry’s largest ever decrease in new PC shipments.

Now, sources for a Reuters story as well as official documents from BlackStone are saying that bit of information caused Blackstone to sour on the idea of purchasing a PC maker.

For some time now, Dell founder and CEO Michael Dell [above] has sought to take his company private in a huge $24.4 billion deal. But Blackstone and investor Carl Icahn opposed the deal, saying it undervalued the company, and were preparing to counter it.

Icahn offered $15 per share for up to 58 percent of Dell; showing broader scope but less value per share, Blackstone had said it would be willing to pay around $14.25 per share for 100 percent of Dell’s stock. Now that last week’s PC downfall means Blackstone’s offer no longer stands, the way has been paved for a Michael Dell-Carl Icahn showdown.

Dell stock is trading down 3.7 percent at $13.43 as of this writing.

Image credit: Dean Takahashi/VentureBeat


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