By Rex Crum, MarketWatch
SAN FRANCISCO (MarketWatch) -- Dell Inc. took the tech spotlight
Tuesday as the PC maker 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.
It was a strong day overall for the market, as the Nasdaq
Composite Index (RIXF) rose more than 40 points, or 1.3% to close
at 3,171, while the Philadelphia Semiconductor Index (SOX) and the
Morgan Stanley High Tech 35 Index (MSH) also advanced by more than
1% each.
Dell (DELL) said it would be acquired by founder and Chief
Executive 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.
Dell shares rose 15 cents to $13.42.
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 its chairman and
chief executive. He "will maintain a significant equity investment"
in Dell after the deal to go private is completed. The transaction
is expected to close by the end of the second quarter in Dell's
2014 fiscal year.
Government IT-services contractor Computer Sciences Corp. (CSC)
rose more than 9% to end the day at $45.75 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 $2.74 after
Bank of America/Merrill Lynch analyst Justin Post raised his rating
on the social-game firm 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 Ltd., saw its shares rise almost 7% to $16.02, on top of
a 15% gain on Monday.
Amazon.com Inc. (AMZN) shares rose 2.7% to $266.89. The company
announced 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), up 3.5%, as well as from
Oracle Corp. (ORCL), Intel Corp. (INTC) and Yahoo Inc. (YHOO)
A notable decliner was Chinese Internet leader Baidu.com Inc.
(BIDU) as its U.S.-listed shares fell more than 10% to close at
$96.37 after analysts at Stifel Nicolaus and Raymond James cut
their ratings on the search-engine provider to the equivalent of
neutral.
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