As Dell Inc. is reported to be conferring with major investors this week, the Round Rock-based company also is scheduled to release its fourth quarter and fiscal year financial results on Tuesday.
The results are expected to be weak, with revenue just above $14 billion, which would down more than 11 percent from a year ago.
Revenue for the entire fiscal year is expected to fall below $57 billion, a decline of more than $5 billion from the year before.
Dell’s personal computer business continues to struggle facing a sluggish global market and tough competition from China’s Lenovo Group, among others.
International Data Corp. estimated that Dell’s PC shipments dropped nearly 21 percent from the year before during the calendar fourth quarter ended in December. Dell’s fiscal fourth quarter actually ended Feb. 1.
Dell’s stock closed at $13.81 a share on Friday, up slightly from the buyout offer of $13.65 a share, reflecting an investor sentiment that the buyout group could be forced to raise its price to win over recalcitrant investors. Two major investors, Southeastern Asset Management and T. Rowe Price Group, were among those that said they did not support the buyout offer price. The New York Stock Exchange was closed Monday for Presidents’ Day.
Unconfirmed reports said the company was scheduling talks with major investors to explain its position.
The buyout group is headed by company founder and CEO Michael Dell, who would contribute his shares plus another $750 million to the deal. A California investment company, Silver Lake Partners, has agreed to put $1.4 billion into the deal and Microsoft Corp., Dell’s major software supplier, has agreed to lend $2 billion. The remaining funds – roughly $16 billion – would come from bank loans.
Dell Inc. also on Friday disclosed that Michael Dell had agreed to accept a lower price, $13.36 a share, for his own shares in the buyout, “in order to facilitate a price increase by Silver Lake” for the remaining shareholders, according to a securities filing.
Jefferies Group analyst Peter Misek reported last week that the Dell offer price might climb as high as $15 a share. If the buyout deal falls through, Misek said Dell shares might fall to $10 a share, which is slightly lower than the share price was when the first buyout reports surfaced Jan. 14.