Dell analysis: It's a three-for-all

For an embattled PC maker, Dell is one popular takeover target.
No less than three potential billionaire suitors -- including activist investor Carl Icahn and company founder Michael Dell -- have lined up to acquire a company badly bruised in the PC battle. Dell's sales slumped 8% last year, to $56.9 billion, while profits shrank 19%, to $3 billion. The stock, hovering around $14.50 per share, is one-third of what it was three years ago.
And yet…
-- Michael Dell has offered $13.65 per share, with Silver Lake and Microsoft likely to chip in. Amid investor cries that Dell underbid, two more bids emerged.
-- Icahn has proposed investing up to $5 billion in Dell, and, through a more complex recapitalization, pay $15 a share for roughly 58% of the company.
The Icahn Plan would assume 24% (from 4.8% today) of the company; Southeastern Asset Management, Dell's largest outside shareholder, would receive 16.6% (from 8.4%); and T. Rowe Price, another major Dell investor, would control 9.3% (from 4.7%).
-- Blackstone Group, which would pay $14.25 a share in a leveraged recapitalization, says it has talked with some of Dell's largest shareholders -- an oblique reference, perhaps, to Southeastern -- and intends to invite them to participate in the recapitalization.
(Adding intrigue to this corporate narrative, Blackstone has indicated its willingness to work with Michael Dell or another high-profile executive, such as former Hewlett-Packard CEO Mark Hurd -- now at Oracle.)
From the outside looking in, Dell the company appears to be the latest cautionary tale of leveraged buyouts. If the Blackstone or Icahn deal tops Michael Dell's, the founder and CEO could find himself ousted after going to great lengths to assume greater control.
Several reports Monday suggest Michael Dell may agree to raise his bid in response to the new offers.
Still, with a little luck, the investors that take Dell private stand to make a fortune.
"We are gratified by the success of our go-shop process that has yielded two alternative proposals with the potential to create additional value for Dell shareholders," Alex Mandl, the chairman of Dell's special committee, said in a statement today. "We intend to work diligently with all three potential acquirers to ensure the best possible outcome for Dell shareholders, whichever transaction that may be."