Monday, April 8, 2013

Everyone Gets $25 Million to Study Dell: I’d Like $25


Everyone Gets $25 Million to Study Dell:  I’d Like $25

The sale of Dell Computer is starting to look like an Oprah Winfrey give-away.  Everyone interested in buying the stock, gets $25 million for due diligence. Blackstone gets $25 million, Silver Lake gets $25 million, and Carl Icahn gets $25 million.

I have two questions: First, what does $25 million of due diligence look like?  It’s hard to imagine, the priciest lawyers, accountants, and consultants chewing up that much money. At this point every thing there is to know about Dell has to have been studied. 

Second, will Dell pay me $25 to do a little work before I buy 1000 shares of the stock?  I’m willing to promise that I won’t launch a proxy fight, and a $25 due diligence budge is just about proportionate to what Carl Icahn will receive for proposing to buy 58% of the company.


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