Feeds

Keep calm and carry on flogging: Dell soothes troops as buyout looms

Or unravels, depending on how you look at it

Beginner's guide to SSL certificates

Dell was on the ball with PCs and servers - then Amazon turned up with its cloud

What Dell, the man, absolutely understands is that it is cheaper to build a future you create and control with research and development, and sales and marketing, than it is to buy it at hyper valuations.

Like Dell used to do with its PC business back in the day, and like it did with servers back in the late 1980s and early 1990s as it entered the server racket to take on incumbents. And as it did brilliantly with bespoke hyperscale servers for the past several years, a market where it has a whopping 50 per cent share.

But you can't miss the tablet and smartphone revolutions without repercussions, and you can't launch your public cloud six years after Amazon and then also be behind the company in terms of features, pricing, and services. Dell is no worse than rivals Hewlett-Packard and IBM in this regard. But this is how companies don't live a century if they are not careful. IBM had several near-death experiences, and it is helpful to remember that Apple did, too. And neither had to go private to fix themselves.

In the meantime, Dell's top brass has to buck up the troops. And to that end, the management team (not signed by Michael Dell or anyone) sent out a letter to employees, which was filed dutifully with the SEC as all of Dell's comments about the leveraged buyout deal and its criticisms have been to date.

"As expected, this proposed transaction has generated significant interest and commentary from media, investors, and other stakeholders," the letter reads, adding:

There will continue to be speculation, conjecture, and uncertainty as the process moves forward. We want to assure you that this is all part of the process being led by our Board of Directors, and we ask that you keep these developments in proper perspective and keep in mind the following.

Today, we remain a publicly-traded company and will continue to operate as such on behalf of our stockholders. It is important to remain focused on serving our customers, providing them a superior experience and the products and solutions to help them do and achieve more.

We are committed to being a best-in-class solutions provider, and as a private company will be better able to shape our long-term vision for the future of technology – and the ways it can help all our customers achieve their goals.

Dell reminded employees that the "go shop" period being administered by Evercore Partners to find a better deal, ends on 22 March. And that the company's plans to cut costs and boost productivity to the tune of $2bn in fiscal 2014 (which ends next January) remains in effect, and that should a better deal not arise, then it expects the Dell-Silver Lake deal to close before the end of the second quarter of this fiscal year, which ends in July.

We shall see. Dell shareholders, and not just SAM and Icahn, are going to have a lot to say about whether or not $13.65 a share is a fair price. The arguments that SAM and Icahn have made that the deal does undervalue Dell are compelling. But that doesn't mean the answer is to borrow money and sell off assets to pay a big fat juicy dividend.

Bootnote: Just after this story ran, Icahn Enterprises, the partnership controlled by the man with the same name, had let it be known to the major biz press outlets that it had inked a confidentiality agreement with Dell so it could get a look at its books. ®

Providing a secure and efficient Helpdesk

More from The Register

next story
Facebook pays INFINITELY MORE UK corp tax than in 2012
Thanks for the £3k, Zuck. Doh! you're IN CREDIT. Guess not
DOUBLE BONK: Testy fanbois catch Apple Pay picking pockets
Users wail as tapcash transactions are duplicated
Happiness economics is bollocks. Oh, UK.gov just adopted it? Er ...
Opportunity doesn't knock; it costs us instead
Google Glassholes are UNDATEABLE – HP exec
You need an emotional connection, says touchy-feely MD... We can do that
YARR! Pirates walk the plank: DMCA magnets sink in Google results
Spaffing copyrighted stuff over the web? No search ranking for you
In the next four weeks, 100 people will decide the future of the web
While America tucks into Thanksgiving turkey, the world will be taking over the net
prev story

Whitepapers

Why cloud backup?
Combining the latest advancements in disk-based backup with secure, integrated, cloud technologies offer organizations fast and assured recovery of their critical enterprise data.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
New hybrid storage solutions
Tackling data challenges through emerging hybrid storage solutions that enable optimum database performance whilst managing costs and increasingly large data stores.