NEW YORK/SAN FRANCISCO, March 29 Dell Inc
said on Friday a leveraged recapitalization would be
fraught with risks for the computer maker and would be unlikely
to offer as much value as the $13.65-per-share buyout agreed
with founder Michael Dell and the private equity firm Silver
The analysis was part of a preliminary proxy statement
published on Friday to inform Dell shareholders of how the $24.4
billion deal was put together, as well as what alternatives the
company's board explored before it approved the deal.
Under the deal, Michael Dell and his investment firm will
own 75.9 percent of Dell, with Silver Lake owning the rest.
Dell said the post-buyout plan anticipated adding a
significant number of sales personnel and boosting spending on
research and development spending. It has no plans to embark on
major assets sales following the buyout, it added,
The restructuring plan envisioned by Michael Dell and Silver
Lake, were it to be carried out with Dell as a public company,
would not be palatable to shareholders and the stock could
suffer, Dell said.
Dell also said a strategic party, whose identity it did not
disclose, expressed interest on Jan. 24 to acquire its financial
services business for its book value, estimated at between $3.5
billion and $4.5 billion, excluding debt. A standalone deal of
this kind would not benefit the company, Dell concluded.
Dell revealed that its special committee, chaired by Alex
Mandl and set up to assess all possible strategic alternatives
for the company, also comprises of board members Laura
Conigliaro, Janet Clark and Kenneth Duberstein.