This is one the largest LBOs in history, the largest since the financial crisis, and an audacious in swimming upstream against technological trends. There is still a 45-day go-shop period during which Dell will entertain competing bids, though without Mr. Dell's stake this is unlikely.
The deal structure is interesting, with Silver Lake contributing cash, Microsoft a $2 billion loan, and Mr. Dell simply rolling over his stake (though his fund, MSD Capital, will contribute some cash, too). The rest is debt financing from Barclays, Credit Suisse, Bank of America, and Royal Bank of Canada.
Apple came pretty close to having the lights turned off. Microsoft stepped in and injected some cash. http://news.cnet.com/2100-1001-202143.html or from Wikipedia:
At the 1997 Macworld Expo, Steve Jobs announced that Apple would join Microsoft to release new versions of Microsoft Office for the Macintosh, and that Microsoft made a $150 million investment in non-voting Apple stock.[62]
This is a myth. Microsoft bought a symbolic amount of stock. At the time Apple had over a billion dollars of cash in the bank. Microsoft was making over $300M a year in revenue from the Office product on the Mac platform, so it was in their best interest to keep up development. The only reason they were going to stop was to strong-arm Apple.
Back then Apple wasn't in great shape, running at a marginal loss or profit, but other companies at the time, like Compaq, were bleeding hundreds of millions of dollars in losses per quarter.
Apple is into Hardware and Software, Oracle is now into Hardware. Some exec at MSFT has seen how good a user experience you can give if you control the entire cycle from hardware to software.
If they entered the Hardware market directly, they compromise Windows - for example companies would distribute Linux with their machines more openly and they could lose the "XXX recommends WinX". So they could do this indirectly by owning Dell privately and pulling the puppet strings.
Secondly if you want to run a massively parallel search engine like bing - you need a lot of hardware. They would probably seat a specialised hardware team at Dell and take the machines at cost.
The deal structure is interesting, with Silver Lake contributing cash, Microsoft a $2 billion loan, and Mr. Dell simply rolling over his stake (though his fund, MSD Capital, will contribute some cash, too). The rest is debt financing from Barclays, Credit Suisse, Bank of America, and Royal Bank of Canada.