Michael Dell has given his company a vote of confidence this week by investing another US$100 million buying shares.
It is thought that Michael paid an average of US$22.07 a share and therefore landed himself an additional 4.5 million shares. That has increased his already majority stake in the company to 221 million shares or 12.4%, and that’s on top of the 26.4 million other shares he indirectly owns.
The purchase was made in 3 lots. The first was on June 27 for 2.23 million shares, the second on June 30 for 100,000 shares and third on July 1 for 2.17 million shares. It is one of the largest new investments in the company for the past 5 years and is being viewed as Michael showing he believes in the future of the PC giant.
Michael Dell returned to the company as CEO in 2007 after it had lost the number one position in the PC market to HP. Since then it has moved more into retail, expanding rapidly in China and Australia, and is now exploring new ranges of laptops including the recently announced Studio range and forthcoming subnotebook Mini Inspiron.
Read more at guardian.co.uk and ZDNet
Matthew’s Opinion
Michael Dell returning to the company has seen things improve there and they look to be on a quest to open up to the market. The days of the gray box PC and standard “just black” laptop are over and PC manufacturers need to react to that. I think Dell are trying very hard as can be seen from their latest laptops, buying Alienware, the Mini Inspiron and the XPS range.
I think this new investment, which may seem substantial to us, but it just a drop in the ocean for Dell’s billions, is a confidence vote. He’s not only making it clear they are trying to regain the PC top spot with the latest products, but also backing that up with new money for the company. In my view it also is a statement that he is there for the long haul.
It will have the desired affect in all quarters I believe. Investors will become more confident, staff will be happy of the extra stability this action conveys and Michael will get the support he needs to continue trying to turn the company around from his management team.
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