Sometimes acquisitions have the power to bring things full circle for a company and for Dell, the company's latest change of hands has the potential to bring it back to a stronger level of growth.
The company’s founder, Michael Dell, has said that he will buy back the computer manufacturer and designer, effectively taking the business off the stock exchange 25 years after it was first launched.
Mr Dell founded the firm himself nearly 30 years ago at the age of 19. He initially ran the business from his dorm room at the University of Texas but later dropped out of the course there to give himself time to develop the Dell range and expand his business.
While he has continued in the role of chief executive and chairman, and owns a 14 per cent stake in the firm, the founder will regain a larger proportion of control through buying the business back.
He aims to do so by buying out the remaining shares through a consortium of himself, his own investment fund and Silver Lake. Meanwhile, a $2 billion loan from Microsoft will help get things moving.
Business buyers often look to take their acquisitions in a new direction and it appears that Dell is no exception. The business has been struggling against cheaper competition from rivals in Asia for sometime now and the dominance of Apple in high-end areas, such as laptops and tablets, has proven to be another barrier to growth.
Analysts have highlighted the fact that the buy-out is not a perfect solution. There is much to be finalised regarding Microsoft’s financial input and Mr Dell himself has admitted that any change in approach will take time to become truly effective.
But removing the need to deliver results every quarter to shareholders should help to give the company the flexibility it needs to take on a marketplace that looks very different from when its new owner first set the wheels in motion back in the eighties.
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