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Dell Confirms Blackstone Withdraws Bid

By Chris Neiger - Apr 19, 2013 at 11:43AM

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Stating Dell's market decline in PC volume and a drop in projected operating income, Blackstone has decided not to pursue buying the computer company.

Blackstone Management has withdrawn its offer to buy Dell (DELL.DL), citing "a number of significant adverse issues [that] have surfaced," including a steep drop in PC sales and a "rapidly eroding financial profile of Dell."

Dell released Blackstone's letter, dated Thursday, in a press release this morning announcing Blackstone's move. "Blackstone has decided not to submit a definitive proposal to acquire the company and is withdrawing from the process," said Dell.

The letter from Blackstone to Dell's presiding director, Alex Mandlwhich, listed reasons for Blackstone's move, including:

  • Dell's "unprecedented" 14% market decline in PC volume in Q1 2013.
  • The company's revising operating income projections for the current year from $3.7 billion to $3 billion.
"For the reasons set forth above, among other reasons, on behalf of Boulder Acquisition Corp., Blackstone Management Partners, Francisco Partners, Insight Venture Partners, and Riverwood Capital, I regret to inform you that we will likely not pursue this opportunity," said the letter.
Blackstone originally submitted a proposal letter to buy Dell on March 22 for around $14.25 per share.
Blackstone's dropping out of the bidding leaves investor Carl Icahn as the only bidder against a February proposal by Dell founder Michael Dell and Silver Lake Partners to take the company private. Icahn is offering $15 per share and the Dell/Silver Lake offer is for $13.65 per share. Earlier this week,  Icahn agreed to limit his ownership stake in the company as he pursues a bid to buy the company with other shareholders.


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