Blackstone Group weighs rival bid for Dell: report
20 Mar 2013
Private equity firm Blackstone Group is considering tabling a competing bid for personal computer maker Dell Inc, Bloomberg today reported, citing people with knowledge of the matter.
Blackstone may bid as part of a group with other investors, an unnamed source told the news agency, while another said that the New York-based buyout group was still undecided.
When Dell's founder Michael Dell and private-equity firm Silver Lake Management had offered to take the company private on 5 February for $24.4 billion, Dell's board had formed a special committee to oversee the offer and had set a 45-day go-shop period to explore alternative proposals.
Michael Dell and Silver Lake's offer requires the approval of a majority of shareholders, excluding Michael Dell, who is contributing his 15.6 per cent stake to the new company.
The $13.65-a-share offer has already invited opposition from Dell's two biggest shareholders - Southeastern Asset Management and T Rowe Price Group, as well as from activist investor Carl Icahn (See: Major investor opposes $24.4-bn Dell deal).
The go-shop period officially ends 22 March, but the special committee has said it will extend the deadline if it gets a qualifying proposal.
Several US media had last week reported that Hewlett-Packard (HP) and Lenovo Group were interested in taking a look at Dell's books, and are said to have conducted due diligence (See: Blackstone Group, HP, Lenovo interested in Dell: report).
HP is the world's largest PC maker followed by Lenovo and Dell. Some analysts say that both HP and Lenovo are not serious contenders but are taking advantage of the go-shop period to review its competitor's books.
If Blackstone does table a bid, it would be its biggest technology deal since its 2006 acquisition of Freescale Semiconductor for $17.6 billion.
Dell's shares are trading 4.8 per cent above the Silver Lake offer and closed yesterday at $14.31, an indication that investors are looking at a better offer than the $13.65 currently on the table.
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