Talks to take Dell Inc private are at an advanced stage with at least four major banks lined up to provide financing, two sources with knowledge of the matter told Reuters, propelling shares of the No. 3 computer maker seven per cent higher.
Buyout firm Silver Lake Partners, which is leading the deal, tapped Credit Suisse, Bank of America Merrill Lynch, Barclays and RBC late last year to finance a potential deal, the sources said on condition of anonymity, because details have not been made public.
JPMorgan is advising Dell on a potential buyout of the $19 billion company, which would be one of the largest deals since the global recession. It will also allow Dell, which has been trying to become a one-stop shop for corporate technology needs as the PC market shrinks, to conduct that difficult makeover away from public scrutiny.
Silver Lake Partners was in discussions with Dell for a buyout at around $13.50 to $14 a share, with an equity investment from Silver Lake and other potential investors of roughly $2 billion, CNBC reported.
Dell, Bank of America, RBC, Barclays and Credit Suisse declined to comment. JP Morgan and Silver Lake did not immediately return calls seeking comment.
Silver Lake, a Bloomberg report said quoting sources, has raised more than $7 billion for its latest fund. The fund, which started gathering money in March, had raised $4.1 billion as of August, meaning Silver Lake won about $3 billion since then.
Dell, which has been in talks with private equity firms on a potential buyout, has had on and off discussions with the firms but talks heated up late last year, they said.
A deal involves equity investment from billionaire CEO Michael Dell, who owns 14 per cent of the world's No. 3 PC maker. Dell, America's 22nd richest person according to Forbes, invests and manages his fortune through MSD Capital.