By Rex Crum, MarketWatch
SAN FRANCISCO (MarketWatch) -- Dell Inc. took the tech-sector
spotlight Tuesday as the PC giant announced its days as a public
company would soon come to an end in a private-equity deal valued
at more than $24.4 billion.
Dell (DELL) said it would be acquired by Chief Executive and
founder Michael Dell and technology investment firm Silver Lake
Partners, ending about three weeks of speculation. The deal values
Dell at $24.4 billion, or $13.65 a share, a 25% premium over Dell's
Jan. 11 closing price of $10.88 a share. Dell picked that date
because it was the last trading day before the first reports of the
company going private were published.
Microsoft Corp. (MSFT) will contribute a $2 billion loan to help
finance the deal.
According to a Dell statement, Michael Dell owns about 14% of
the company's shares outstanding and will remain CEO and chairman
of the company. He "will maintain a significant equity investment"
in Dell after the deal to go private is complete. The transaction
is expected to be completed by the end of the second quarter in
Dell's 2014 fiscal year.
Government IT services contractor Computer Sciences Corp. (CSC)
rose 8.4% to $45.41 after the company reported upbeat fiscal
third-quarter results. CSC said it earned $3.27 a share on $3.78
billion in revenue, compared with a loss of $8.96 a share on sales
of $3.69 billion in the same period a year. Excluding one-time
items, CSC said it would have earned 77 cents a share. Analysts
surveyed by FactSet had forecast CSC to earn 62 cents a share on
$3.73 billion in revenue.
Zynga Inc. (ZNGA) shares climbed more than 7% to $2.75 after
Bank of America/Merrill Lynch analyst Justin Post raised his rating
on the online social-games company to buy from underperform, citing
factors such as "asset value and mobile stabilization." Zynga is
scheduled to report its fourth-quarter results after the close of
trading Tuesday.
BlackBerry (RIMM), which until this week was known as Research
In Motion, saw its shares rise 7.7% to $16.13 on top of a 15% gain
on Monday.
Amazon.com Inc. (AMZN) shares rose almost 2% to $265. The
company debuted Amazon Coins, a new virtual currency for purchasing
apps, games and in-app items on the Kindle Fire tablet.
Gains also came from Apple Inc. (AAPL), Oracle Corp. (ORCL),
Intel Corp. (INTC) and Yahoo Inc. (YHOO).
A notable decliner was Chinese Internet leader Baidu Inc. (BIDU)
as its U.S.-listed shares fell more than 10% to $95.82 after
analysts at Stifel Nicolaus and Raymond James cut their ratings on
the search-engine provide to the equivalent of neutral.
The Nasdaq Composite Index (RIXF) rose 23 points to 3,154, while
the Philadelphia Semiconductor Index (SOX) and the Morgan Stanley
High Tech 35 Index (MSH) also advanced.
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