Dell goes private, bought by Michael Dell and Silver Lake

Microsoft is contributing a loan to the deal

By , IDG News Service |  IT Management, Dell, Michael Dell

Since then it's been on an acquisition spree, buying 25 companies to build out networking, software and services businesses. Notable buys include Quest Software, Perot Systems, Force 10 Networks and Wyse Technologies. Dell's goal is to refashion itself into an all round provider of hardware, software and services, mimicking larger rivals IBM and HP, except focused primarily on the midmarket.

It's had some success, but combining those acquisitions into cohesive "integrated systems" is a long road. Dell itself said last year that it could be a two to three year journey. Investors have been impatient, and Michael Dell apparently grew tired of running his company to the whims of a stock market that often favors immediate return over long-term investment.

"Dell has made solid progress executing this strategy over the past four years, but we recognize that it will still take more time, investment and patience, and I believe our efforts will be better supported by partnering with Silver Lake in our shared vision," Michael Dell said in the statement. "I am committed to this journey and I have put a substantial amount of my own capital at risk together with Silver Lake, a world-class investor with an outstanding reputation. We are committed to delivering an unmatched customer experience and excited to pursue the path ahead."

The company's PCs and server hardware remains the core of its business for now. Dell has said it will stay in the PC market because it provides an entry point to selling other, higher-margin products and services. It offers fewer low-cost computers and more high-end models like its XPS PCs, which has caused it to fall behind HP and Lenovo in worldwide shipments.

Dell has also exited the smartphone market, but sells tablets that target use both at home and in the enterprise.

The transactions calls for Dell shareholders to get $13.65 in cash, a premium of about 25 percent over Dell's closing price on Jan. 11, when rumors of a deal first appeared, the company said.

Agam Shah covers PCs, tablets, servers, chips and semiconductors for IDG News Service. Follow Agam on Twitter at @agamsh. Agam's e-mail address is agam_shah@idg.com

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