Dell has seen its share price jump by more than 20 percent on speculation that the company may be in negotiations to be bought out by a private equity firm.
According to an article published by Bloomberg, TPG Capital and Silver Lake are in talks to be acquiring Dell and taking the company private. Prior to the acquisition rumors, Dell traded at a market capitalization of about $18.9 billion, but has since jumped to $22.8 billion.
Bloomberg noted that the deal could be announced as early as this week, but could fall apart due to the massive volume of the deal and the required cash that is necessary to purchase Dell. Rumor has it that the deal would be structured as a management buyout.
Company founder Michael Dell could beone of the main beneficiaries of a buyout, provided that he will cash in on all of his owned stock. Dell currently sits on more than 244 million Dell shares with an aggregate value of about $3.2 billion. However, Dell is likely to retain a major stake in the company even in a buyout scenario, as money may not be a compelling incentive for the executive: Forbes currently ranks him as the 22nd richest American with an estimated wealth of $14.6 billion. Bloomberg estimates Dell's net worth at $13.7 billion.
Dell founded the company at age 19 in 1984.