Dell is under a double whammy of declining sales and privatisation

NetEase Science and technology news AUGUST 12 According to Reuters, the past few months for the control of Dell's company Dell and Icahn had a public quarrel and veiled behind-the-scenes negotiations. But these obscure the fact that Dell's sales are falling steadily. The battle between chief executive Dell and activist investor Icahn has begun to make some clients sleepless. And the bleak outlook for the global PC market is even more worrying. IDC estimates that Dell's PC shipments will fall 4.2% per cent year-on-year in the second quarter. Dell first expressed its intention to privatize in August 2012, when Dell had acquired a dozen companies and was trying to shift from a Low-margin PC business to a business-service provider, but investors may not be able to wait until Dell's new plan is put into practice. So Dell and Silver Lake formed an alliance, ready to carry out a deal worth 24.4 billion of dollars, the cost of 13.65 dollars per share of the company to privatize. Then Michael's opponents came in. March 5, the last day of the 45-day statutory "window period" awaiting approval of the agreement, Blackstone has submitted a 14.25-dollar bid to Dell's Special Committee, almost at the same time that Icahn, who claims to have read the news in the newspaper, quickly bought 1 billion of Dell's shares. In early March, Icahn submitted a bill to the Dell board claiming that it would use its cash, Dell cash reserves and issue bonds to raise money for the deal. Buy 1.1 billion shares at a price of $14 per share, which is worth nearly 16 billion dollars. It also urged Dell's board to distribute a dividend of $9 per share, using cash and issuing new debt. In April, the three-party bidding situation changed. Blackstone announced a withdrawal of 25 billion dollars to buy Dell's offer. The reason is that since the submission of the offer, Dell has lowered its operating profit forecast for the current fiscal year from USD 3.7 billion to $3 billion. Because of the question of whether privatization would help the company to transform, Icahn apparently disagreed with Michael Dell. That, in part, encouraged some of the shareholders who had objected since the announcement of the privatisation offer. June 19, Southeast Asset Management company will hold half of the Dell stock, about 72 million shares, sold to the IGAD, so far, the Iraqi Kan holds 152 million shares of Dell, about 8.7% of the total number of foreign shares, Dell, except Michael Dell's largest shareholder. A few hours before the vote began July 24, Michael and private-equity firm Silver Lake Silver agreed to raise the Dell privatisation offer from $13.65 per share to $13.75 and pay a special dividend of 13 cents per share. And declare that this is their final offer. So far, the new offer is valued at close to $24.9 billion trillion, 500 million dollars higher than the original estimate. To this end, the Dell Special Committee announced the postponement of the privatization vote until August 2, as "more time is needed to assess". But billionaire Icahn thinks, "Add only 13 beautyIt is a humiliation for shareholders. The company declined to comment on the matter. Michael Dell's email to employees warned employees to stay focused in Thursday. He then provided similar assurances to clients in Friday. "I know it's a tough time. Recent events have been increasing uncertainty, but we are determined to demonstrate why Dell is the best solution provider to meet your needs as the first priority. The chief executive said. Watching and waiting for China's Lenovo company in the second quarter to become the world's top PC sales, accounting for 16.7% of the market share, more than HP's 16.4%. IDC estimates that Dell is 12.2% and ranked third. In addition to the PC business, analysts say rival HP has surpassed Dell in key areas, including networking and storage. HP is also making strides into corporate computing, which has just launched a micro-server moonshot to save power costs for the company. Dell spokesman David Frink said: "Dell's Roadmap is robust and the company will soon organise a series of customer meetings around the world to showcase new products and services." "Analysts estimate that the long-term impact of privatisation on Dell's business is far from over. They will follow the company's quarterly earnings announcement of August 20. "It's going to be a high-risk and painful process," Morningstar analyst Carlinfield said, pending results that "make customers skeptical". Wall Street's forecast was a quarterly profit of 417 million dollars, half the 875 million dollars last year. Revenue is expected to fall 2%, up to $14.2 billion trillion. Despite Dell's 13 billion-dollar takeover from software to the Web since 2008, Dell's fortunes remain tightly tied to PC sales. PC sales, which have shrunk in the past three years, still account for half of Dell's revenue. Global PC sales are expected to fall 7% this year, down 4.5% next year, analysts at CLSA said. According to the Boston Consulting Group, Dell's revenues will shrink from year to 2016. "Investors should keep a close eye on Silver Lake and Michael Dell," said Brian Marshall, analyst at ISI Group Blaine Machel. He said the company could end up underperforming, with a profit forecast of 26 cents per share and a revenue of $14.3 billion. However, even if he beats the imam, some analysts think it may be too late, as IBM and HP have locked up most corporate markets. HP and IBM have been in the corporate market for 7-10 years and Dell is just getting started.