Dell Inc. is getting closer to clinching a leveraged buyout with Silver Lake Management as Microsoft plans to provide some funding, people with knowledge of the matter said Tuesday.
Silver Lake and Dell, based in Round Rock, are negotiating a price of $13.50 to $14.25 a share, said one person, who asked not to be named because the talks are private. Microsoft is discussing contributing about $2 billion for the deal, which could be announced this week, the person said.Microsoft stands to benefit from propping up Dell, one of its largest partners in selling personal computers that run Windows software. Both companies are racing to make up for an industrywide slump by working together on tablets, a market led by Apple and Google. Microsoft could also use Dell's help selling to business customers."For Microsoft to continue to be healthy, it needs strong enterprise partners," said Tim Bajarin, founder of the technology consulting firm Creative Strategies Inc.Representatives for Silver Lake, Microsoft and Dell declined to comment.If the deal isn't completed this week, that would indicate that price has become an obstacle and that the transaction could fall through, one of the people said.Dell is one of a few vendors selling a tablet with Windows RT, a version of Microsoft's operating system. Dell will also begin shipping a separate tablet using the main operating system, Windows 8, this month.Microsoft needs the support of PC makers as Apple, Amazon.com and Samsung Electronics lure consumers with tablets. Microsoft has also shifted its long-standing tactic by competing with its own partners in selling a tablet machine of its own, called Surface.Microsoft hasn't commented on Surface sales, leading some analysts to speculate that the machine may not be faring well. Windows 8 also had a disappointing debut, said Todd Bradley, executive vice president at Hewlett- Packard.This isn't the first time Microsoft has considered bolstering a potential Silver Lake deal. In 2011, the software maker offered to help fund an offer by Silver Lake and others to acquire a minority stake in Yahoo, people familiar with the matter said at the time. The deal never materialized.Have more to add? News tip? Tell us
