Michael Dell: What can he do for Dell?
As Michael Dell takes Dell back under private ownership, what does this now allow him to do?
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It also, crucially, allows it to fail without drawing too much fire for doing so. It can take a few gambles, without having to balance that with concerns over keeping the share price healthy. Presumably, the long term plan will be to float again, but the company can at least do a lot of things to try and reposition itself before it does so.
Time
Furthermore, that also buys time. Just because Dell is now a private company doesn't mean it's not beholden to investors. This isn't a case of Michael Dell having a perusal of his wallet, and pulling $24 billion in change out of it. In fact, the funding of the deal is interesting in itself. Dell has put his existing share of the firm on the table, while Microsoft has chipped in with a loan of $2 billion. Furthermore, up to four banks and one investment partner have also been used to gather the necessary funds. They're not in it for the love (although Microsoft obviously has a heavily vested interest in Dell being a healthy company), and so just because the pressure won't be on amidst public shareholders, there are still some hefty investors to satisfy. The clock will still be ticking, it's just there's a little bit more breathing space to reenergise the firm.
It should be said that the decision to effectively move behind those closed doors raises some degree of suspicion, and Michael Dell will need to be savvy in how he plays the PR game here. Confidence in Dell, the company and the man, remains crucial to maintain, especially with a long-term floatation likely to be on the agenda.
Radical?
The mystery remains though: what can Michael Dell do now for the company that bears his name? You'd have to assume that he's got some radical retooling in mind that, if conducted in the public eye, would be an even bumpier ride than it's likely to already be. Chances are, not until it comes time to float again will we find out how successful, or otherwise, he's been. Do expect his bank account to do quite well out of it all, though
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