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Dell Buys Dell for $24.4 Billion
By George L. Koroneos
The rumors are over. Dell officially announced, Tuesday morning, that the computer behemoth was being purchased by its founder and CEO Michael Dell (with financing from the Silver Lake investment firm, Microsoft and a handful of others) for $24.4 billion. As part of the deal, Dell will be taken private and Michael Dell will remain CEO of the company after the sale is complete.
"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," Michael Dell stated in a release. "I believe our efforts will be better supported by partnering with Silver Lake in our shared vision."
Dell has had a rough couple of years as the company continued to bet on hardware while its competition turned to new endeavors including cloud solutions and expanded services.
“The implication of going private is that Dell is planning radical changes to its strategy and product roadmap," analyst firm Ovum stated. "While the company might come out of this transition stronger with a product lineup that better meets the needs of businesses and public sector organizations, there will be uncertainty as to what products and services stay, get strengthen, or get eliminated.
As for its POS division, that’s solution providers are taking a wait and see approach. Rival HP, last year, made the huge mistake of openly stating that it was considering selling its personal computer division, which included POS solutions. HP quickly backpedaled after channel partners vocally expressed their confusion and disappointment. While Dell probably won’t do anything as drastic, it will be interesting to see what Dell’s vision for the future holds.
pcAmerica CEO David Gosman said that he thinks this deal could prove positive for the channel. "Dell will likely concentrate on more lucrative areas—cloud computing, storage, software—and less on their core PC and peripheral business," he told VSR. "I think they’ll also put some more concentration on their mobility products (such as their new tablet.) I’d have to guess they will take a more targeted attempt at selling these products and services through channel partners—an easier path to market for them and a path that can open up some service options for resellers to add to their offerings."
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