Temasek not interested in Silver Lake’s Dell deal – report

According to Reuters, Temasek doesn't regard Dell as a good fit for its strategy, which seeks to leverage transforming economies, growing middle income populations, comparative advantages and emerging industrial champions. Given this remit, it is no surprise that 70% of the fund's investments are in Asia.

Silver Lake is said to have approached Credit Suisse, Bank of America Merrill Lynch, Barclays and RBC about financing the deal. Dell's current market capitalization is more than $22 billion so a take-private transaction would likely be one of the largest deals since the global financial crisis. CEO Michael Dell owns 14% of the company and is expected to participate in a transaction, if one emerges.

Dell is the world's third-largest PC manufacturer, having fallen behind Hewlett-Packard and Lenovo in the last six years, with Acer a close fourth, according to research firm Gartner. The company shipped 9.2 million units in the fourth quarter of 2012, down 20.9% year-on-year.

Gartner noted that the 4.9% drop in global PC shipments to 90.3 million units reflected a structural shift in the industry, in addition to reflecting more straightened global economic conditions. The emergence of tablet devices has fundamentally altered the nature of computer demand as consumers opt to buy tablets rather than replace older PCs.

Dell has responded by focusing on technology services for the corporate market, but it is thought this challenging transition might be more easily executed away from the public markets spotlight.

Silver Lake and Temasek have co-invested before, albeit in Asia. They were part of the consortium that paid $2 billion for a 5.7% stake in Chinese e-commerce platform Alibaba through an employee liquidity event in 2011, and followed up by covering a portion of the $3.9 billion private equity financing used to support Alibaba's $7.6 billion buyback of a stake from Yahoo.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• Buyouts
• North America
• Southeast Asia
• Technology
• Silver Lake
• TMT
• Temasek Holdings
• USA
• Singapore
• buyout