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Bloomberg: Dell Said to Work With AlixPartners on Post-LBO Turnaround

September 25, 2013, 07:32 AM
Filed Under: Turnaround Management

Bloomberg reports Dell Inc., the computer maker that founder Michael Dell and Silver Lake Management LLC are taking private for $24.9 billion, is working with AlixPartners LLP on its turnaround, according to people with knowledge of the matter.

AlixPartners, which advised General Motors Co. on its restructuring when the automotive giant filed for Chapter 11 bankruptcy protection in 2009, is counseling Dell on organizational restructuring and cost cuts, said one of the people, who asked not to be identified because the information isn’t public.

The move highlights how the Round Rock, Texas-based personal-computer maker is working to reshape itself after shareholders on Sep. 12 approved the go-private deal.

The leveraged buyout itself was mired in months of wrangling, with opponents including billionaire activist Carl Icahn arguing that the deal undervalued Dell. The shareholder vote was postponed three times, and didn’t pass until Dell and Silver Lake twice sweetened the price, ultimately boosting it to $13.88 a share from $13.65 a share.

The turnaround will have to include cuts of Dell’s workforce of 108,800, to make up for the lack of cost efficiencies after acquisitions in the past five years, said the person. Dell has bought companies including computer-services company Perot Systems Corp., data-storage company Compellent Technologies Inc. and software maker SecureWorks Inc.

To view the entire Bloomberg article, click here.

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