14 DAY TRIAL // Dell may have come out on third place in terms of PC shipments in 2012, but it does not feel comfortable with itself, enough so that it has begun courting banks in case it decides to go private.
Dell hasn't made any press release about this, but Bloomberg says that the corporation is in talks with private equity firms.
Should the talks go well, the corporation will withdraw from the public stock market and sell its assets to private investors.
Current Chief Executive Officer (CEO) Michael Dell already owns 15.7% of all shares, which is a lot.
Because of this, the deal with financial firms should be easier to negotiate and finalize than for other companies.
On that note, trading for Dell shares was briefly paused recently, during which the share value rose 15%.
Nevertheless, the deal could fall flat if the required money cannot be gathered by the interested parties (two financing firms are said to have shown interest).
Dell has only about $5 billion to help it cope with the slow business. 2012, for instance, brought a 7% drop in revenues, compared to 2011, and the trend isn't showing any signs of stopping.
Since going private would involve looser regulatory issues, shareholders could benefit a lot, and Dell would be able to recover from this downturn.
Either way, the corporation needs some money fast, if it is to offset the 2012 34% drop in profit. Dell would end up being owned by a private entity, but at least there wouldn't be talks of bankruptcy and layoffs. 2012 brought enough of those.
It is interesting to note that Michael Dell considered taking the business private back in 2010, but he decided to wait for a bit longer.
Dell, officially, hasn't commented on these rumors, but that really isn't surprising. Companies rarely do respond to speculations like this one.