Silver Lake seeks investors in Dell deal: sources

Fri Jan 18, 2013 11:53am EST
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By Nadia Damouni and Poornima Gupta and Saeed Azhar

NEW YORK/SINGAPORE (Reuters) - Silver Lake Partners, trying to finalize a bidding group to take Dell Inc private, is in talks with the manager of Canada's pension plan and other potential investment partners, people familiar with the matter said.

Dell also has formed a special committee to take a close look at any potential deal on the table, multiple sources with knowledge of the matter told Reuters.

Silver Lake, in its quest to put together what would be the largest buyout since the global financial crisis, has reached out to the $170 billion Canada Pension Plan Investment Board and other investors in its fund, known as limited partners, the people said.

Thus far, Singapore's state investor Temasek Holdings Pte Ltd -- another prospective equity partner that Silver Lake has tapped -- is not interested in joining the consortium, the people said.

While Silver Lake has yet to line up investment partners, the buyout firm has told its bank lenders that it remains very confident about its ability to secure equity financing, two of the sources said.

Founder and CEO Mike Dell remains a linchpin of the effort. The man who grew Dell from a college dorm-room hobby into the world's No. 3 PC maker is sitting on an estimated personal fortune of $14.6 billion, according to Forbes.

It is unclear how much the billionaire will contribute to the buyout, or how much of his 14 percent stake in Dell will be rolled into the deal, the sources said.

One of the two sources said Silver Lake did not need to line up firm commitments from equity partners like CPPIB ahead of time, because those could be secured after a deal structure is devised and put in place.   Continued...

A Dell computer logo is seen on a laptop at Best Buy in Phoenix, Arizona, February 18, 2010. REUTERS/Joshua Lott