Dell Inc is in talks with private equity firms on a potential buyout, two sources familiar with the matter said, confirming reports that sent shares in the world’s No. 3 PC maker soaring 13 percent to nearly an eight-month high.
The firms are now holding discussions on a deal with billionaire CEO and founder Michael Dell, who owns about 14 percent of the company, according to one source with knowledge of the matter.
The Wall Street Journal cited unidentified sources as saying TPG and Silver Lake could team up on an offer, possibly in conjunction with other investors such as pension funds. JPMorgan Chase & Co was also involved in the negotiations, it added.
The first source said any potential deal could be structured as a management-led buyout with Michael Dell at the helm. He now owns 244 million shares in the company, according to Thomson Reuters data, and last year was ranked the 22nd richest American with a fortune of US$14.6 billion.
Talks had progressed for two to three months, heating up in late last year, and a deal could be reached in six weeks, the Journal cited sources as saying.
Dell, which has steadily ceded market share to Hewlett Packard Co and China’s Lenovo Group (聯想), declined to comment on what it called rumors and speculation.
The company has lost 40 percent of its value since last year’s peak and is trying to reinvent itself as a seller of higher-margin services to corporations — an internal overhaul that might be conducted away from public scrutiny.
Some analysts say taking the company private, an idea that has surfaced sporadically in past years, makes sense.
However, others pointed to the sheer expense of such a deal, an outsized debt burden of about US$4.5 billion and murky prospects as a major player in a PC market that is dwindling with the advent of tablet computers.
Before news of the deal emerged, Sanford Bernstein analyst Toni Sacconaghi speculated that Dell was worth US$12 a share on a sum-of-parts basis, of which the PC business was worth about US$4.70. In a report last week, the analyst said Dell could conceivably be split along its PC and enterprises segments, though such an approach would significantly reduce much-needed scale.
Shipments of computers by the company, now reinventing itself as a provider of computers and services to corporations and government agencies, plummeted 21 percent in the fourth quarter, according to IDC. In the third quarter, its profit slid 47 percent.
On Monday, another industry research firm, Gartner, estimated that Dell lost 2 percentage points of market share in the fourth quarter, slipping to 10.2 percent from 12.2 percent a year earlier.
Dell’s stock soared to an intraday high of US$12.83 in afternoon trade — the highest since May last year — after a brief trading suspension. It closed at US$12.29.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day