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Michael Dell Reassures Customers in Open Letter on Buyout

By - Source: Dell | B 14 comments

Michael Dell issued an open letter to customers.

Michael Dell is doing a little PR work of his own as details of the leveraged buyout begin to spill across the newsroom floor.

His latest endeavor is an actual open letter to customers assuring everyone that there's nothing to fear about being a little private. He calls the transition an "exciting new chapter for our company". Oh, it's an exciting time for you too, Dell's loyal customers, even though the company will likely focus its energy making money in the enterprise sector as it has for the last five years.

"As always, our unwavering focus is on delivering a fantastic customer experience and creating value for your organization," he said. "We believe that our proposed new ownership will provide long-term support to help Dell innovate, invest for growth and accelerate our transformation strategy. We’ll have the flexibility to continue organic and inorganic investment and drive industry-leading innovation."

The letter goes on to sound even more business-focused. "We’ve made solid progress over the past few years," he added. "Our leadership and our strategic execution have been consistent, as we’ve built a comprehensive portfolio to help you succeed. Secure, easy to manage, end-to-end solutions from the cloud to the data center to devices remain at the core of our value proposition to you."

On Wednesday a regulatory document filed with the SEC revealed some of the details behind the proposed $24.4 billion leveraged buyout of Dell. Silver Lake actually invested up to $1.4 billion USD while Michael Dell dumped $500 million of his own cash – in addition to his 273 million shares worth $3.73 billion – into the deal. Microsoft also stepped in and loaned out $2 million while the Dell family's $12 billion investment fund, MSD Capital, added another $250 million in cash.

Michael Dell is also reportedly trying to secure $13.8 billion in loans, via Bank of America, Barclays, Credit Suisse Group and Royal Bank of Canada, to support the leveraged buyout. Both Silver Lake and Michael Dell can walk away from the deal if its not completed by November 5, 2013.

"I am honored to continue serving as chairman and CEO of Dell and very much appreciate the trust you’ve placed in us," Michael Dell said. "We recognize that ours is a highly competitive industry. Our commitment to you is to keep earning that trust every day. I am confident we are making the right decisions to position Dell, our customers and employees for long-term success."

Michael Dell also has a video about his commitment to customers which can be seen here.

 

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  • 5 Hide
    matthelm , February 8, 2013 2:47 PM
    Dell hasn't been a "Good" PC maker since the mid 90s!
  • 4 Hide
    Rafterman414 , February 8, 2013 2:54 PM
    Hopefully this can help turn Dell around and get them thinking long term instead of having to constantly worry about how the shareholders will react every quarter.
  • 0 Hide
    spentshells , February 8, 2013 3:14 PM
    Micheal Dell is to computers what Micheal Myers is to horror movies

    they both had their days before anyone knew any better.....
  • 0 Hide
    rebel1280 , February 8, 2013 4:04 PM
    As long as dell keeps making awesome servers, smart switches and continues to give awesome customer support i dont care who owns what. But dang, how in the world can anyone ask for billions of dollars in loans from banks?! I cant even fathom how one pays that off especially since hes giving most of his private capital off..
  • 3 Hide
    unksol , February 8, 2013 4:20 PM
    again, Microsoft is contributing two BILLION. With a B. Not two million. Even even we correct you guys its still repeated wrong over and over in every other cut and paste "article", and never corrected....
  • 1 Hide
    CaedenV , February 8, 2013 4:57 PM
    matthelmDell hasn't been a "Good" PC maker since the mid 90s!

    I would give them the late 90's as well. Those old white Pentium 3 Dells were rock solid and could last forever. It was when the Pentium 4 hit their shelves that they started having major issues.
  • 1 Hide
    robochump , February 8, 2013 5:44 PM
    Geez, I guess M Dell is really tired of listening to whiny investors...lol. As for hardware I never had much problem with Dell desktops, its the laptops you gotta worry about. lol.
  • 0 Hide
    bunz_of_steel , February 8, 2013 5:49 PM
    All that money in their hands and not in the company and they still can't figure out why they aren't making any money. Dang that's lotta money to have just to be able to dump into a company.
  • 0 Hide
    JeanLuc , February 8, 2013 9:26 PM
    The question is if Michael Dell is still a man of time or a man behind the time? I'd wager the former as successful businessmen like Michael have a habit of being just that, successful.
  • 0 Hide
    faster23rd , February 9, 2013 1:09 AM
    In the world of PR, "exciting" has become the alternative for something worrisome or crappy. Ooorr, maybe PR folks live in different world where "exciting" is something entirely different.
  • 0 Hide
    faster23rd , February 9, 2013 1:10 AM
    In the world of PR, "exciting" has become the alternative for something worrisome or crappy. Ooorr, maybe PR folks live in different world where "exciting" is something entirely different.
  • 0 Hide
    kinggremlin , February 9, 2013 4:56 AM
    unksolagain, Microsoft is contributing two BILLION. With a B. Not two million. Even even we correct you guys its still repeated wrong over and over in every other cut and paste "article", and never corrected....


    Hey now. Give Dr. Evil a break. He forgot what year he was in again.
  • 1 Hide
    beayn , February 9, 2013 12:06 PM
    While I know the stock market drives the world economy, I also think it can be disastrous. With the stock market, profit isn't good enough, it must always be increasing profit. One can not simply make 1 billion a year, it must be 1.1, then 1.2, then 1.3 etc. As a result, companies must cut corners and continually make their products cheaper and cheaper and design them to last shorter and shorter times to try to increase those profits and satisfy shareholders.

    Now we have a throw-away society with massive amounts of pollution, and waste with crappy crappy products that are designed to last only a few years at most.

    The saying "They don't make them like they used to" is widely used for good reason and the stock market is the reason for that phrase holding so much truth.

    Taking DELL private could be a good thing.
  • 0 Hide
    jemm , February 10, 2013 9:50 AM
    This deal sounds a bit confusing to me -- is it a merge or an acquisition? Perhaps a joint venture?