Dell Jumps on Possible Buyout News

Last month, shares of Dell ($DELL) jumped after an analyst at Goldman wondered whether the company could be the target of a buyout offer. Today Bloomberg is reporting that Dell is talking with two possible suitors.

Round Rock, Texas-based Dell is discussing going private with at least two firms, said one of the people, who declined to be identified because the talks are private. The discussions are preliminary and could fall apart because the firms may not be able to line up the needed financing or resolve how to exit the investment in the future, the people said.

Several large banks have been contacted about financing an offer, one of the people said.

Michael Dell owns 15.7% of the company, so he’s made about $400 million since the Bloomberg story came out.

By the conventional numbers, Dell is cheap at this price. But I wonder how sustainable their business is for the long term.

Posted by Eddy Elfenbein on January 14th, 2013 at 2:56 pm

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