The Sound and the Fury — Dell vs. Hurd

Is this a potential 15-round winner-take-all championship bout or perhaps a joint effort dressed up to look like a championship fight? The group led by Michael Dell has an offer of $24.4 billion ($13.65 a share) on the table, so any offer from Blackstone would have to top that. Shares are already trading above $14 on shareholders’ expectations that a higher bid will show up. Activist investor Carl Icahn and another large Dell shareholder, Southeastern Asset Management, think the company is worth more than $20 a share.

Not Blackstone nor any other bidder is likely to come anywhere near $20 a share for Dell. Now, let’s say that Blackstone’s offer comes a buck or two more per share than Dell/Silver Lake and includes Hurd as the new CEO. Michael Dell still owns nearly 16% of Dell Inc.’s stock and, unless he decides to cash out, he is not likely to agree to play second fiddle to Hurd or anyone else. So we might expect a deal where Dell Inc. is run by co-CEOs, one of whom has presided over the rise and fall of his namesake company and the other whose slashing of HP’s workforce endeared him to shareholders.

A truly competitive bid from Blackstone is a longshot. As our title suggests, it’s a tale full of sound and fury, signifying nothing.

Dell’s shares peaked at around $14.40 yesterday after the WSJ story on the possible Blackstone deal. Shares are trading flat at $14.14 in mid-afternoon today, in a 52-week range of $8.69 to $17.15.