Sign in with
Sign up | Sign in

Michael Dell: We Need To Transform, And Do It Quickly

By - Source: Michael Dell | B 15 comments

Michael Dell makes his final pitch to stockholders.

Last week Michael Dell sent an open letter directly to company shareholders, telling them that the company needs to transform, and to do so quickly.

The letter to stockholders arrives after the company said on July 18 that a vote on the $24.4 billion buyout had been delayed because not enough shareholders have weighed in on the buyout. "Today’s Special Meeting of Stockholders was convened and adjourned to provide additional time to solicit proxies from Dell stockholders," the company said on July 18. "No vote was taken on the proposed transaction prior to the adjournment."

That new meeting was supposed to take place on Wednesday, July 24. However, the Special Committee instead said it received a revised proposal from Michael Dell and global technology investment firm Silver Lake under which they would increase the buyout price to $13.75 per share in cash, subject to certain conditions. Because of the new development, the Special Meeting will be adjourned to August 2, 2013.

"In light of the revised proposal, which the Special Committee is evaluating with the assistance of its financial and legal advisors, the Special Meeting of Stockholders previously scheduled to be reconvened today at the Dell Round Rock Campus will be adjourned to August 2, 2013 at the same location," the company said.

The proposed amendments include the increase to $13.75 in cash per share of company common stock, and a modification to the "Unaffiliated Stockholder Approval" agreement that allows "the will of the majority of the unaffiliated shares that vote on the transaction to control the outcome." Previously, the agreement allowed non-voting shares to count against the transaction, thus even if the majority of the voters approve of the buyout, they may be defeated thanks to the non-voters. Michael Dell called this "unfair."

The proposal clearly states that Dell and Silver Lake are not willing to discuss further increases or the $13.75 increase without the change to the "Unaffiliated Stockholder Approval" requirement. "I believe this offer is in the best interests of the company and our shareholders," Michael Dell said in his letter. "Certain other parties have been proposing alternatives such as leveraged recapitalizations, sales of assets and other steps that I believe would be destructive to the company and that I do not and will not support."

"I believe that taking Dell private is the right thing to do for the company," he said. "We need to transform, and we need to do it quickly.  The transformation is not without risks and challenges, and I believe that we can do what we need to do better as a private company than a public company."

"The decision is now yours," he added. "I am at peace either way and I will honor your decision."

The full open letter from Michael Dell can be read here.

Display 15 Comments.
This thread is closed for comments
  • 3 Hide
    SirGCal , July 29, 2013 10:38 AM
    Dell used to make nice hardware. Now they just don't. Their top-end and Alien-ware gear ya but... Mainstream and business (where the $ is) no. We used to use em and dumped em. Just not reliable. That was their problem.
  • 5 Hide
    house70 , July 29, 2013 10:50 AM
    He's been saying that for a while now.
    Less chat, more splat, eh, Mr. Dell?!....
  • 3 Hide
    NightLight , July 29, 2013 11:06 AM
    dell needs to get into the tablet business, and expand their cheap workstation business.
  • 6 Hide
    catfishtx , July 29, 2013 11:18 AM
    It's sad when a PC made in the late 90's/ early 00's refuses to die and when its replacement made in the middle/late 00's can barely make it to the 2-yr mark. I have a Dell Dual Xeon Server and XPS Gen 2 still going strong. The newer Dells have terrible power supplies and motherboards. They make eMachines look like a premium brand.
  • 6 Hide
    tleavit , July 29, 2013 11:55 AM
    I've spend 2 million with Dell in the past 8 years. The laptops (business latitudes and Precisions) has a life expectancy of 3-5 years and 99% of them have gone 8 years. We still have 30% of our computers running XP since these units have run so well. of the 15-20 $20K servers I have purchased in the past 8 years... not one has ever had a single problem, not one call to support. Bash Dell's as you will... but math is math.
  • -1 Hide
    tleavit , July 29, 2013 11:56 AM
    I've spend 2 million with Dell in the past 8 years. The laptops (business latitudes and Precisions) has a life expectancy of 3-5 years and 99% of them have gone 8 years. We still have 30% of our computers running XP since these units have run so well. of the 15-20 $20K servers I have purchased in the past 8 years... not one has ever had a single problem, not one call to support. Bash Dell's as you will... but math is math.
  • 1 Hide
    dextermat , July 29, 2013 12:44 PM
    Michael Dell, what you really need to do is bring back quality control and costumer support!!
  • 5 Hide
    Yuka , July 29, 2013 1:28 PM
    PRO TIP: Stop making overpriced junk.

    Cheers!
  • -1 Hide
    eodeo , July 29, 2013 6:50 PM
    Dell, the Apple of the PC world. Overpriced mediocrity.
  • 0 Hide
    p05esto , July 29, 2013 8:28 PM
    Sorry, but I love Dell products, espeically their laptops. The Dell Precision laptops are great. The M6700 has an IPS screen in it, LED, 17.3".... it's a portable workstation and there isn't an equal out there in terms of quality and performance. Just saying. I have no problems with Dell, none. I also buy and use their web servers (DRAC is a gift from the gods).
  • 0 Hide
    tadej petric , July 30, 2013 2:49 AM
    Ive got more than 10 years old Dell (gx240). It works perfectly. Sure its slow (age, it was great back then), but reliable. It survived lightnings, water, me (unplugging it at random times) and so on. Thats what it used to be - a good company.

    But all the things listed above are gone now. They sell PCs that hold 3y MAX. Thats just shame...
  • -2 Hide
    Steveymoo , July 30, 2013 3:41 AM
    No shit, Sherlock.