It's Official: Dell's Top Execs Sound Off On $24.9 Billion Buyout

Dell Shareholders Approve $24.9B Buyout To Go Private

Dell executives took the hot seat hours after Michael Dell announced victory in his yearlong fight to keep control of his company and win shareholder approval of a $24.9 billion leveraged buyout. In a phone briefing with media, Dell chairman and CEO Michael Dell and CFO Brian Gladden answered a wide range of questions regarding the buyout, from what's next for Dell to whether it's getting out of the consumer PC business to what channel partners should expect in the next few years.

What follows is a question-and-answer style breakdown of what they had to say about the deal.

Put Today's Leverage Buyout In Historical Dell Perspective.

In taking Dell private, we plan to go back to our roots and make Dell one of the fastest growing and most successful companies. We are unleashing the creativity and confidence that have always been the hallmark of our culture: to serve our customers with a single-minded purpose and drive innovations that will help them be more productive grow and achieve their goals.

We stand on the cusp of the next technological revolution. The forces of cloud, big data, mobile and security are changing the way people live, businesses operate, and the way the world works. That's the same way the PC did almost 30 years ago.

-- Michael Dell, Chairman and CEO

What's Dell's Four-Year Plan As A Private Company?

We plan to invest in several key areas that are aligned with our business strategy. First, we will extend our enterprise and solutions business capabilities through investments, research and development, and additional acquisitions.

Second, will be investing in sales coverage and expanding our growing channel partnerships with our Partner Direct program. We are going to expand our presence in growing and emerging markets. Fourth, we are going to be investing in growth in PC, tablets, and virtual computing markets. Despite the contractions in global PC demand, continued leadership is critical to our growth, and profitability is critical. We will continue to invest in these important markets.

Finally, Dell's expansion as an enterprise and solutions provider is critical to our future success. Especially as the PC market is changing faster than anticipated.

-- Michael Dell, Chairman and CEO

What Can You Do As A Private Company That You Can't Do As A Public Company?

I think what you'll see is an accelerated opportunity around our overall strategy. We are going to target key priorities that we think will accelerate the progress we are making with end-to-end solutions. As a private company we'll have a longer-term time horizon around key investments in the business. And we will be able to make the right long-term decisions around investments to advance our strategy.

-- Brian Gladden, Dell CFO

We will have the flexibility to accelerate our strategy and pursue organic and inorganic investments without the scrutiny of quarterly targets and other limitations as a public company.

-- Michael Dell, Chairman and CEO

What Will Dell Look Like In Four Years? What's The Mix Of Enterprise, PCs, And Mobile Devices?

That's really hard to say. We see the value of the broad portfolio of products. To be honest, we'll continue to make investments to play a leadership role in the PC business and end-user computing and devices. We think that's an important part of a portfolio. It's not a part of the business we are trying to shrink. We continue to make large investments in R&D and sales capacity around the enterprise solutions and business services. So, what we have seen over the last three to four years is that part of the market is growing faster. We've made investments that have accelerated our growth in those markets -- in many cases faster than the rest of the market. That would suggest that enterprise solutions and business services would grow to be a bigger part of Dell's business in the years ahead. I think that will continue. But, by no means is that a statement about our commitment, or lack of commitment, to our PC business.

-- Brian Gladden, Dell CFO

You Said Dell Will Boost Its Partner Direct Program. How So?

We have a broad commitment to expanding our partner programs and doing that on a global basis. That's an important element to our growth strategy. Those relationships are critically important to us. There are many of our customers that value that route to market for Dell. So it continues to be a priority. Our partners' programs continue to expand in terms of investments right alongside our expanding PartnersDirect footprint.

We've seen the number of partners expand over the past couple years. We are approaching 140,000 partners at this point. I just think you'll see more of the same.

-- Brian Gladden, Dell CFO

The Post-Private Dell Strategy Is Nearly The Same As Your Pre-Private Strategy. What's Different?

The strategy is sustained. The reality is these efforts do take time. We are in the midst of this process. It would be disconcerting if today we came out with a brand new set of initiatives and strategies for the company.

It's our intent to accelerate and drive key strategies with consistency quarter to quarter for the life of the company. These things take time, so it shouldn't be surprising if it's the same things we've been focused on for a while.

-- Brian Gladden, Dell CFO

What's Dell's Edge As Over IBM, HP, And Cisco?

I think our strategy has been differentiated. Look at what we built over the last several years in terms of a portfolio. In some ways it looks like our competitors offerings. But, Dell is very much focused on scalable, open technologies [that] have a faster time market.

Ultimately, Dell is well positioned with mid-market customers that value what we offer. I think that's differentiated. That's not to say we don't scale up into large accounts and can serve all the way to consumers and BYOD. Dell's differentiator is being a practical, innovative [company], being efficient, affordable and building on direct relationships that we have. That's very different from what our competitors do.

-- Brian Gladden, Dell CFO

How Long Will It Take To Execute Your Transition Plan?

We've done a pretty broad reset of the Dell strategy over the past four years. We've acquired significant assets and built new platforms and end-to-end solutions. We've build what is a $21 billion business that's related to enterprise solutions and software business. The important pieces of the puzzle are in place, now it's about execution.

As we speak with customers, we are recognized for having a full portfolio of solutions to help them with their challenges. So I think we are the middle of a transition plan. I think we'll continue that plan, and over the next several years you'll see that capabilities continue to broaden.

-- Brian Gladden, Dell CFO

Where Is Dell's Future Growth Going To Come From?

We play in a $3 trillion industry. There is no competitor that has more than a 3 percent share of that $3 trillion market. If you think about that and look at that money over the next four years, we expect -- and all the analysts expect -- growth in that space. Spending is going to continue to grow. The breadth of our portfolio is more than PCs now. So exposure to the data center, exposure to the key drivers in spending today in IT, such as like virtualization, I think give us a chance to get more than our fair share of the $3 trillion opportunity.

-- Brian Gladden, Dell CFO

Will Going Private And Focusing On Enterprise Trigger Belt Tightening Elsewhere?

We'll continue to balance. There are clearly places where we will realign resources around big growth opportunities. I think that's part of what any company does and what we have been doing. So, places that we will continue to invest that are important will be earmarked for those investment dollars and other places. We'll have to realign resources and refocus resources where there is a need. We don't have anything specific planned tied to this transaction.

-- Brian Gladden, Dell CFO

The Vote Was 65% Yes, 35% No. What Do You Have To Say To Shareholders Who Are Upset By The Vote?

It's been a long and, from all angels, complicated process. [What] you have to do is rely on the process that the board went through with the special committee. All you can do is rely on the board's good judgment. Obviously, there are going to be people who second-guessed various steps within and through that process. But, I think that from almost all accounts it was a very well-run, very disciplined and thoughtful process to ensure the shareholders were represented fairly throughout the process.

-- Brian Gladden, Dell CFO