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Dell Goes Private In $24.4 Billion Leveraged Buyout Deal By Michael Dell And Partners

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Dell has indeed made the decision to go private, according to reports today from The AP and other sources. The deal reportedly involves a leveraged buyout worth $24.4 billion by company founder Michael Dell and partners.

Talks about Dell going private have been growing this year, with reports last week saying that Michael Dell was offering up to $1 billion of his own funds to take control of the company to help make it happen. The deal was reportedly brought to the Dell Board of Directors for a vote last night according to Bloomberg.

The deal will also include Microsoft, which is investing $2 billion in the deal, as well as private equity firm Silver Lake Partners, which will invest $1 billion, according to a source speaking to Reuters. Dell stockholders will get $13.65 in cash per share in the arrangement, Reuters reports, with Michael Dell remaining at the helm of the newly private entity.

Microsoft has released an official statement on the Dell privatization deal, which reveals that it is essentially injecting the money into the business in order to help keep a key partner solvent and producing hardware to support its ecosystem.

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.

Analysts have been split on what the decision to go private means for Dell. Some argue that it’s a good move, since it’ll allow the company to make decisions behind close doors, without having to answer to shareholders. Such a move could also make internal restructuring easier, and set the stage for sell-offs of less successful components of the business, simplifying all of those processes and limiting the number of people who have influences over those kinds of hard decisions. Others think that this isn’t a move that will transform the company, but simply one that stalls failure while keeping the real problem (read: Michael Dell) intact.