Dell going private – quote of the day

As you have probably heard, the rumor is that Dell is trying to go private, ie. to take the company back from the public markets and not be accountable and transparent to the public anymore.

Well there’s a really great story by Dennis Howlett from ZDNet today where he gives a good breakdown. You should read it here.

I was struck by this quote as I read it this morning because I thought it was the PERFECT summary of what could be going on.

He says (regarding Dell’s thinking):

But despite its many fans, Dell has to transform if it is to overcome the ravages of the broader market and transition to a new business model.

My guess is Dell management has calculated that the cost of achieving that transformation and the steps it has to take in order to get there will be so painful and expensive that any attempt at achieving their goal while in the public financial gaze will almost certainly provide a substantial distraction.

….

It is far better to go through the transformation with the help of seasoned private equity but out of sight of public scrutiny. For all the bad press that PE gets, they do two things that are often missing in public companies and especially those that have strong entrepreneurial DNA: they know how to exercise strong fiscal control and they know how to squeeze out waste that incumbent management struggles to overcome.

That frees up the entrepreneurial managers to do what they do best: come up with business models that breathe new life into the company.

Very well said.

Once again, the article is here.

  • http://joker-jim.blogspot.com/ Joker Jim

    Used Dell computers since Mike started. Never had one issue. Still use a Studio at home but most everything done now is on a tablet or smart phone. I understand, Michael.

  • Mike Greenway

    Most of the press is becoming more and more about fanning the flames of competition into war than reporting the truth. Too much hearsay not enough fact.