Dell Delivers, CEO Michael Dell And Silver Lake Reported To Net 90 Percent Upside Since Going Private

Let's face it, sometimes a father knows best, and that applies to business as well. Hence why Michael Dell, founding father of the world's third largest PC company, fought so hard to take Dell private so that he could maneuver the firm in the path of his vision without being second guessed and scrutinized by shareholders every step of the way. And now a year removed from the $24.9 billion buyout, things are looking bright.

Exceedingly bright, that is. Citing a pair of people with knowledge of the matter, Bloomberg reports that Michael and private equity firm Silver Lake Management LLC have made a paper gain of at least 90 percent on their investment. And if they're being honest, neither would likely say they expected that to happen this quickly.

Dell invested $4.2 billion into the takeover process with Silver Lake adding another $1.4 billion -- the remaining balance was financed by debt and cash from the PC maker. A year later, Dell's equity value is at least $10.8 billion. And to think the deal almost didn't happen.

Michael Dell
Image Source: Flickr (Charlie Brewer)

Billionaire investor Carl Icahn fought tooth and nail to prevent the takeover at the proposed price and at one point threatened to drag things out in court. However, he was at least successful in increasing the takeover bid and ultimately backed down from opposing the buyout.

A lot of things are going right for Dell at the moment. Cash flow is up, debt is down, and the company's share of the PC market jumped from 11.9 percent a year ago to 13.3 percent currently. Dell's also benefiting from circumstances, such as the fact that the PC market is entering a recovery period of sorts.

It's an exciting time for Michael and his company. Armed with the ability to make quick decisions and put them into motion with less red tape, Dell is a more nimble player than it was before with a lot of upside to boot. It will be interesting to see what the next year brings.

Via:  Bloomberg
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