Microsoft Mulling a $1~$3 Billion Investment to Help Dell Go Private
Bloomberg last week revealed Dell's desire to go private, and this week, we learn that Microsoft is one of the companies looking to make that happen. It's unclear exactly how much money Microsoft would have to invest in order to seal the deal, but it's said to be between $1 and $3 billion - almost a modest figure given Dell's total current value of $22~$25 billion.
Microsoft isn't the only entity that's required to make a buyout a reality, however. Michael Dell himself could use his existing stock, currently valued at around $3.6 billion, while Silver Lake Partners and other investors would need to cough up $2 billion. Additional funds could come from Dell's balance sheet and result in some new debt of about $15 billion.
In recent years, Dell has struggled with rapidly changing market trends, and no doubt believes that going private would allow it to focus on improving that situation. However, such a contribution by Microsoft could cause some grief for the company's other partners, and it of course could raise questions by consumers since Dell would likely be obligated to focus to a large degree on Microsoft's software, because really, why else would Microsoft want to invest so heavily?
As has become fairly obvious in recent years, however, it couldn't hurt Microsoft to get tight with an experienced PC vendor. This may be what's needed to help the company get back on track - especially if it's not only Microsoft throwing ideas around, but Dell, too.