Nokia Shares Rise, Microsoft Falls in Reaction to Deal

Shares of Nokia, the soon-to-be-ex-Finnish wireless phone giant, are rising significantly in reaction to the company's $7 billion deal to sell its devices business and license its wireless patents to U.S. software company Microsoft.

After the first hour of trading this morning, American Depository Receipts of Nokia had risen by $1.37, or more than 35 percent, to $5.26. Before the announcement of today's deal, the shares had fallen by more than one percent this year.

Meanwhile, shares of Microsoft fell by more than five percent in reaction to news of the deal. By 10:30 am ET, Microsoft shares had fallen by $1.81 to $31.59. The move mostly erased the benefits of a rally in Microsoft shares that came on Aug. 23, after CEO Steve Ballmer announced plans to retire from the company. Prior to today's news, the shares had risen by more than 25 percent this year.

RELATED POSTS:

• Microsoft CEO Promises to Limit Nokia Phone Names to 10 Syllables or Less
• Samsung, HTC Mum on Any Interest in Windows Phone Post-Nokia
• Elop in July: It's "Hard to Understand the Rationale" for Selling Nokia's Devices Business
• Microsoft Is Getting Nokia's Phone Business for a Song
• Nokia Shares Rise, Microsoft Falls in Reaction to Deal
• So Much for BlackBerry's "Clear Shot" at Being No. 3 in the Smartphone Market
• Selling Nokia Was Hard Emotionally, But Right Thing to Do, Says Interim CEO
• Marko Ahtisaari, Nokia's Top Designer, To Leave Company in November
• Steve Ballmer on Why Buying Microsoft's Biggest Phone Partner Makes Sense
• Nokia Interim CEO: We Have Three Strong Businesses Remaining
• Barcelona Rendezvous, 50 Nokia Board Meetings Led to Microsoft Deal
• Microsoft's Nokia Deal By The Numbers
• Microsoft Confirms It Gets Less Than $10 Per Nokia Windows Phone Sold
• Stephen Elop Is Now Microsoft CEO Candidate to Beat
• Microsoft Wants to Keep Licensing Windows Phone to Others, Post-Nokia Deal
• Microsoft Explains the Rationale Behind the Nokia Deal
• Microsoft to Buy Nokia's Device Business in Deal Worth $7.17 Billion

Broadcom Pays $164 Million for Renesas 4G Wireless Chip Unit

Wireless chipmaker Broadcom said today that it will pay $164 million to buy the LTE wireless chip assets of Japan's Renesas Electronics.

Under terms of the deal, a team of chip designers based in Finland, the United Kingdom and India will become Broadcom employees, though the companies aren't yet saying how many people are involved. Bob Rango, Broadcom's executive VP and general manager of its mobile and wireless group, said the group of employees is largely composed of a batch of ex-Nokia chip designers who did some of the early work on setting 4G wireless standards. "This is a very experienced group of designers, many of whom were at the table when the 4G standards were set," he told me.

Broadcom had previously been seen as lagging rivals like Qualcomm in the development of chips for 4G phones.

Renesas had announced that it would stop developing its 4G wireless in June. Rango said the chips are already certified for use by several carriers, including AT&T in the U.S.; Vodafone, Orange and EE in the U.K.; and NTT DoCoMo in Japan.

Broadcom said the deal will cut into non-GAAP earnings to the tune of 12 cents a share when Broadcom reports its results of the quarter ending Dec. 31. It also expects the acquisition will cut into its fiscal 2014 earnings by 10 cents to 15 cents on a non-GAAP basis, but that it will be accretive to earnings starting with the 2015 fiscal year.

The company also boosted its outlook for the quarter ending Sept. 30, saying it now expects to report revenue in the range of $2.075 billion to $2.175 billion, and for gross margins to rise as much as 10 basis points.

Broadcom shares rose in premarket trading by more than one percent, to $25.51 per share.

With $50M Boost, Silent Circle Aims Blackphone At Enterprise Security

IBM Again Pledges $1 Billion to a Linux Effort

Linux continues to dominate data centers. IBM wants more of that action to take place on its hardware.

The computer giant on Tuesday plans to pledge that it will spend $1 billion over four or five years on Linux and related open-source technologies for use on its Power line of server systems, which is based on the internally developed chip technology of the same name.

IBM has long been one of the biggest backers of Linux. It made another celebrated $1 billion pledge in 2000 to support the technology as it was beginning to gain a foothold in businesses.

Read the rest of this post on the original site

D.C. Navy Yard Shooter Had Ties to HP Contractor

The suspected gunman in the shooting incident at the Washington, D.C., Navy Yard that has left 12 people dead had worked for a contractor to Hewlett-Packard, the company says.

I just received a statement from an HP spokesman confirming that Aaron Alexis (pictured in a handout from the FBI), who authorities have identified as the perpetrator in today's attacks, was employed by an HP subcontractor working on a tech project for the Navy and the U.S. Marine Corps.

Here's the statement in full:

"We are deeply saddened by today's tragic events at the Washington Navy Yard. Our thoughts and sympathies are with all those who have been affected. Aaron Alexis was an employee of a company called "The Experts," a subcontractor to an HP Enterprise Services contract to refresh equipment used on the Navy Marine Corps Intranet (NMCI) network. HP is cooperating fully with law enforcement as requested."

As The Wall Street Journal reported earlier, Alexis was a 34-year former Naval Reservist who had ties both to Fort Worth, Texas, and to Queens, N.Y. He died in a shootout with police.

He had joined the Navy in 2007, but was kicked out in 2011 as a result of charges relating to an incident in Fort Worth in which he was said to have fired a gun through the ceiling of his apartment into the apartment above his, after complaining about noise.

No apparent motive has yet emerged for the shooting.

SAP Ties Up With AT&T to Help Ease Business App Creation

SAP and AT&T announced plans to broadly offer the German software company's suite of mobile app creation, security and mobile management software. AT&T said that SAP's software will be made available to its business customers starting in the fourth quarter.

Oracle's Results Weren't So Bad, After All

Shares of enterprise software giant Oracle are falling this morning after the company reported earnings that beat expectations, but included a weaker-than-expected outlook for the quarter ahead.

Oracle shares fell by nearly one percent, to $33.60, as of 10:20 am ET.

The company's results have been uneven for the last few quarters, as demand for corporate IT products has slowed in recent years. As president Mark Hurd put it on a conference call with analysts, Oracle is muddling through a weak-demand environment along with everyone else: "We read all of our peer groups' results. And to be very blunt, they're not very good. So depending on who you're talking about, most of their numbers are negative."

Part of the problem with the outlook was that it was a tough comparison. In the second quarter last year, new cloud revenue grew by 18 percent, an unusually high rate, so it makes meeting the results - let along beating them - kind of difficult. As CFO Safra Catz put it, "this will be a very, very tough comparison ... Our sales leaders remain very careful about what they are forecasting to us."

Even so, it wasn't such a bad quarter. In fact, as Stifel Nicolaus analyst Brad Reback put it, it was kind of good. Software sales remained solid, he said, making the quarter's results and its outlook not so bad after all.

Revenue from new licenses was at nearly $1.7 billion, ahead of expectations, and that was despite a currency headwind that was twice as bad as expected. Added to that, there was healthy demand in, of all places, the government-spending sector. "We think that some of the changes the company made over a year ago are finally starting to take hold," Reback said.

Hardware revenue remained, as Reback called it, "a sore spot." As the dwindling business of selling older hardware dragged down hardware sales, the "Exa" family of "engineered systems" gained traction with some customers, but at the lower-priced end of its range. "Although we still think this business has the potential to be a modest grower, we don't expect that to happen until at least fiscal year 2015," Reback wrote.

Overall, he thinks that Street expectations for Oracle's second fiscal quarter were unrealistic to begin with: "We think the company has addressed many of its recent sales execution issues and should benefit from its immense pipeline, improving sales productivity, and numerous new products, over the next several quarters."

Social Analytics Startup Unmetric Raises $5.5 Million

Unmetric, a startup that aims to provide social media business intelligence to brands, announced on Thursday that it raised a $5.5 million round of venture funding. The round was led by new investor Jafco Asia, with participation from existing investor Nexus Venture Partners.

What's Behind the Increased Buyout Bid From Michael Dell and Silver Lake

Michael Dell and the private equity firm Silver Lake increased their offer to take the computer company Dell private in a leveraged buyout not because they think the company is necessarily worth more, but because they want a change in the rules under which shareholders will vote on the transaction.

According to sources familiar with the situation, the new offer of $13.75 for all outstanding shares of the company, or 10 cents higher than the previous offer, amounts to only a minimal increase that adds about $150 million to the pot, and values the company at about $26.6 billion.

People familiar with the thinking behind the increase say the issue is not money, but the rules that the special committee of Dell's board overseeing the go-private process created at the start of the process. Under those rules, a shareholder who doesn't vote is the equivalent of a shareholder who votes against the transaction. The new offer is contingent upon those rules being thrown out.

When the first votes were tallied last week, un-voted shares amounted to about 27 percent of the total, or about double the 12 percent to 15 percent usually seen in situations like this. As one source close to the situation put it, there's a good chance that a majority of shareholders who favor the deal could outnumber those who actively vote against it.

But the scales could be tipped by the large number of shareholders who haven't voted and are for various reasons unlikely to vote. That would ultimately derail the transaction entirely.

"The presumption that these shares should be treated as if they had voted against the transaction is patently unfair," Michael Dell and Silver Lake said in a joint statement. (Read it in full below.)

That block of non-voting entities and individuals amounts to about 405 million shares and breaks down into four groups, according to people who have studied the situation.

As one source who requested anonymity put it: "It's a great big number and frankly no one modeled accurately."

One group is shareholders who owned the shares before the current record date of June 3, but who have sold them and therefore no longer have an interest in the outcome of the buyout battle.

A second group is institutional shareholders like sovereign wealth funds that have a policy of simply not participating in proxy votes of the companies in which they invest.

A third tier is comprised of shares held by banks and brokerage accounts on behalf of wealthy individuals who have a policy of not voting in proxy contests.

The last and probably the biggest block amounting to about 10 percent of shares outstanding, are ordinary retail investors, who may choose not to vote, or may not even know that the opportunity to vote exists.

Dell and Silver Lake have asked the special committee to change the voting rules to declare non-voting shareholders as uncounted votes, not "no" votes. The new proposed rules would count only votes of those shareholders who definitively vote one way or the other.

The special committee is expected to be amenable to the rule change, but wants a higher bid of about $14, according a report from Bloomberg News.

According to a person familiar with the history and tone of the negotiations, Dell's special committee insisted on the voting rules in order to improve the "optics" of the situation. It wanted to appear to be going the extra mile and beyond in order to preserve its neutrality

There are no provisions under Delaware law or in any other jurisdiction that requires non-votes to be counted as no votes in a proxy election. The Michael Dell/Silver Lake group opposed the rule during the negotiation process, but members of the special committee, led by Dell director Alex Mandl, insisted, and in the end it stuck.

No one in the investor group thought the fate of the entire transaction, which would be the largest private equity transaction since 2009, would hang on this rule. It may end up bringing the entire process to a screeching halt. If that happens, the prospect of an extended fight for control of the company and significant drop in the company's share price is very real.

Here's the Dell/Silver Lake statement.

Statement of Michael Dell and Silver Lake

July 24, 2013 - Michael Dell and Silver Lake Partners released the following statement today:

Under current provisions, shares that don't vote are counted as votes against the transaction for purposes of determining whether a majority of the unaffiliated shares wish to accept our offer. According to our latest tally, approximately 27% of the unaffiliated shares have not yet been voted. The presumption that these shares should be treated as if they had voted against the transaction is patently unfair.

We believe that $13.75 per share is a full and fair price. We also believe that the decision of whether to accept this offer should rest in the hands of the unaffiliated shareholders. The will of the majority of the unaffiliated shares voting on the transaction should not be thwarted by an unfair standard that counts unaffiliated shares not voting as "no" votes. We believe that the vote of the majority of the unaffiliated shares voting on the transaction should be respected, and that if this majority wishes to accept our offer, it is only fair to permit them to do so.

In our proposal to the special committee, we also left it open for them to decide whether to change the record date. We believe a change in the record date is essential as it would give shareholders time to process and vote on our new proposal.

Box Brings Touch ID To Its iPhone App, Updates Web Experience

Dropoff Will Build Same-Day Delivery Right Into Your Business

Amid Corporate Reorganization, Symantec Names Five New Execs

Last month, security software company Symantec confirmed a significant round of layoffs, amounting to about eight percent of its total headcount.

Today it starting adding back to that headcount with the naming of five new senior executives, including a chief marketing officer, a chief communications officer, a chief security officer and two senior VPs.

Announced in a corporate blog post earlier today, the five new execs are being brought on to execute a company-wide shift in direction instituted by Steve Bennett, Symantec's new CEO, who joined the company a year ago.

The new hires are:

• CMO Manny Kostas, a former SVP of marketing and strategy at Hewlett-Packard, who left after a shake-up last year. He has been working for Polycom since October.
  
• CCO Colleen Lacter, a veteran of PR agency Waggener Edstrom (better known as Microsoft's PR agency). She was involved in many significant product launches, including Windows 95, Internet Explorer, MSN and Bing.
• CSO Julie Talbot-Hubbard, previously chief information security officer at Ohio State University.
• Matt Lynch will be SVP for eBusiness. He was most recently COO at Amazon-owned IMBD.com. Stephen McHenry will be SVP for Cloud Platform Engineering. He's a Google veteran whose titles there have included CIO, CTO and engineering chancellor. His job will include building out Symantec's cloud computing infrastructure.

The hires are part of a broader shake-up that Symantec said was coming in a regulatory filing earlier this year. It said it plans to take charges related to its reorganization amounting to between $220 million and $250 million for the 2014 fiscal year ending next March. In June, it carried out the largest of a series of job cuts, eliminating about 1,700. Of those, 1,000 were supposed to have been cut in June, with the remaining cuts taking place this month.

Carl Icahn Blasts Michael Dell's Latest Buyout Offer With Twitter Poetry

Yesterday, it was references to Bob Dylan lyrics. Today, Carl Icahn, the activist investor seeking control of the computing company Dell, blasted the latest buyout offer from its founding CEO and board of directors with a short rhyme on Twitter:

All would be swell at Dell if Michael and the board bid farewell.

- Carl Icahn (@Carl_C_Icahn) July 24, 2013

He later followed up that tweet with another of his open letters to Dell shareholders, calling for the ouster of CEO Michael Dell and the company's current board of directors.

The latest buyout offer from Michael Dell and Silver Lake values the company at $13.75 a share, or $24.6 billion. The offer is contingent on a change in the rules of the buyout process that counts non-votes as essentially equal to "no" votes on the proposed buyout. (See this earlier post for a detailed explanation.)

Icahn called that provision "the one thing protecting the interests of Dell stockholders," and went on to say that "... To change the rules at the last minute is outrageous." He repeated previous complaints about the $450 million breakup fee that he says Silver Lake would receive in the event the buyout doesn't close, and called on the board to eliminate that provision. He also repeated a call for Dell's board to convene its annual meeting of shareholders, and to hold a proxy vote that would include a slate of directors he has proposed to oversee the company.

His latest letter is below:

Dear Fellow Dell Stockholders and Special Committee:

In today's latest installment of the "Desperate Dell Debacle," Michael Dell/Silver Lake have asked the Company to change the rules of the game in a transparent attempt to force their freeze out transaction across the finish line despite the vote of its stockholders. In a Merger Agreement with widely-criticized protective devices in favor of Michael Dell/Silver Lake and a sales process that included a number of advantages for Michael Dell/Silver Lake, the one stockholder protection was the requirement that a majority of the non-Michael Dell shares approve the deal. The Special Committee has now been asked to GUT this provision to effectively render it meaningless. And, in return, Michael Dell/Silver Lake have offered to increase the deal price by $0.10, or 0.73%!

The Merger Agreement and the Proxy Statement established the rules. We and other stockholders have spent time and money understanding the rules created by Michael Dell, Silver Lake and Dell, and we have played by them. To change the rules at the last minute is outrageous. And, in this case, it appears the Special Committee may even agree with us, or at least they did back in February, when Dell, Michael Dell and Silver Lake ALL AGREED IN WRITING in the Merger Agreement that the required stockholder approvals "shall not be waivable." SHALL NOT BE WAIVABLE. Perhaps that means something else to Michael Dell/Silver Lake and the Special Committee, but to us, it means what it says - You can't get rid of this one provision that is designed to protect the interests of non-Michael Dell stockholders. Of course, this is precisely what Michael Dell and Silver Lake are today trying to do.

Michael Dell/Silver Lake this morning commented that the stockholder approval requirement is "unfair". Are they serious? They're complaining about the fairness of the Merger Agreement that they and their lawyers negotiated and agreed to! How is it fair to change the rules at the end of the game, particularly when they and their teams of lawyers established the rules? If they are so concerned about fairness, then let's discuss and actually make the Merger Agreement fair - let's get rid of the outrageous $450 million break up fee and change the definition of a Superior Proposal so it actually encourages competing bids. It's outrageous to construct a merger agreement where a competing bidder does not get compensated with a break up fee if they are matched or topped. By not allowing this, it is virtually insurmountable to incentivize banks to finance a higher bidder.

We have spent the past 6 months explaining why we believe that not only does the Michael Dell/Silver Lake transaction undervalue the company, but it also freezes out loyal stockholders who deserve the opportunity to stay with Dell. How is that fair? In short, we have explained why we believe Michael Dell is doing a great disservice to his stockholders and has structured a deal that we believe is unfair. Today, Michael Dell and Silver Lake crossed the Rubicon by trying to take away the one provision in the Merger Agreement that actually provided stockholders with a voice in their company. It is time for Michael Dell and this Board to go. After more than a year since the last annual election, it is time to schedule the 2013 Annual Meeting and move forward.

A few days ago we warned this Board not to run the Company like a banana republic. Some commentators have even compared this "Desperate Dell Debacle" to Vladimir Putin and North Korea! After this latest action by Michael Dell/Silver Lake, we are clearer than ever - it is time for Michael Dell and this Board to go.

BlackBerry to Gartner: Not Dead Yet!

BlackBerry might be in trouble - ugly, worst-case-scenario trouble - but it's not yet in terminal decline, and the company has taken exception with a report claiming it is.

In a recent note to clients, research outfit Gartner advised those who use BlackBerry's smartphones and its enterprise server solution to develop contingency plans to replace them should the company perish. "All clients should immediately ensure that they have backup mobile data management plans and are at least testing alternative devices," Gartner analyst Ken Dulaney wrote. "Clients have three to six months to build a strategy."

Among Dulaney's suggested courses of action: Discontinue BlackBerry support for any employees except in cases explicitly approved by management; "Move completely away from BlackBerry devices."

Given BlackBerry's sad collapse and its decidedly uncertain future, that's not unreasonable advice. It's hard to imagine anyone who uses the company's products looking at its massive second-quarter loss and its now piddling share of the smartphone market and not concluding that some sort of action needs to be taken.

But BlackBerry feels it's all a bit hysterical. In a statement to AllThingsD, the company dismissed Gartner's recommendation as premature.

"We recognize and respect external parties' opinions on BlackBerry's recent news," a BlackBerry spokesman said. "However, many of the conclusions by Gartner about the potential impact of a sale or other strategic alternatives are purely speculative. BlackBerry is restructuring and pursing strategic alternatives to increase its focus on its core enterprise business. We remain steadfast in our mission to deliver the most secure and powerful mobile management solutions and smartphones to our customers."

That's great to hear, but hardly reassuring. BlackBerry's commitment to its mission and the resuscitation of its business isn't really in question. It's the viability of that business and the market's interest in its products that are concerning.

EMC Cloudscaling Purchase Is One More Attempt To Stay Relevant

Oracle Taps Adrian Jones to Head Asian Operations (Read the Memo)

Software giant Oracle named Adrian Jones to head its operations in Asia. The move was announced in an internal email from Oracle president Mark Hurd, obtained by AllThingsD.

If the name sounds familiar, it may be because Jones (pictured) is a former Hewlett-Packard exec who was sued by that company in 2011. HP had alleged that Jones stole trade secrets and shared them with Oracle. The suit dates back to one of the more rancorous periods in the relationship between those companies, and the aftermath of the days when Hurd, who was for five years the CEO of HP, joined Oracle following his surprise resignation in 2010. (That situation, you'll recall, spurred its own legal merry-go-round.)

In a lawsuit filed in the California Superior Court in Santa Clara County, HP had accused Jones of copying sensitive files concerning its strategic and financial plans, plus other information, to a USB drive, and not returning them when he resigned from the company. Among other things, lawyers for HP had sought to examine every electronic device Jones owned, including phones and iPads belonging to his girlfriend.

It later turned out that the copying of the files in question didn't take place at the time that HP originally said it did, but during a period when the computer Jones used was in the hands of HP's corporate security office. Talk about awkward.

Since then, the case has been forgotten. HP was eventually forced to withdraw the case against Jones entirely, according to people familiar with how it all turned out. Neither HP nor Oracle would confirm that, however. Entries in the case-record file on the court's website make vague mentions of a dismissal that occurred on July 30, 2012.

The case against Jones was one of many HP filed during a period when Michael Holston was its general counsel. Remembered as a key aide to Hurd during the years he was running HP, Holston remained HP's general counsel during the 11-month tenure of former CEO L o Apotheker, but was among the first members of HP's executive council to leave the company after Meg Whitman became CEO.

Anyway, enough with the legal footnotes. Here's the memo announcing Jones' promotion:

From: Mark Hurd
Date: July 24, 2013, 2:00:02 AM PDT
To: Oracle Asia Pacific Sales

The business across Asia Pacific represents a significant opportunity for Oracle. We continue to invest in this region and it is poised for growth.

I am pleased to announce Adrian Jones to the position of General Manager and Senior Vice President, Oracle Asia Pacific. Adrian will lead the region for hardware and software, and be responsible for accelerating market share, revenue, and margin growth.

Adrian has strengthened our Systems business and has held senior leadership positions across the IT industry for more than 20 years. Before joining Oracle, he held the position of Senior Vice President of Enterprise Servers, Storage and Networking for HP Asia Pacific and Japan. He has in-depth knowledge of these markets.

I would also like to take the opportunity to thank Steve Au Yeung for his contributions to Oracle. Steve is leaving Oracle, and we thank him for his five years of leadership and wish him the best in the future.

Mark

IBM Acquires Wireless-Analysis Company Now Factory

Computing services giant IBM said today that it will acquire the Now Factory, a privately held company based in Dublin, Ireland, that creates software used to analyze wireless network usage. Financial terms were not disclosed.

IBM said Now Factory's capabilities will be added to its MobileFirst Analytics portfolio of services that analyze business data and seek to optimize the experience customers have online.

Service providers are straining under the load of data demands as consumers try to use more video, gaming and other online data on their phones and tablets. The Now Factory adds capabilities to analyze how consumers interact with various services on their phones, and to yield faster insights on their behavior, Big Blue said.

Michael Dell Is "At Peace" With Whatever His Shareholders Decide

Asa Mathat | D: All Things Digital

Michael Dell made what reads like his final appeal to shareholders of the computing company that bears his name, seeking their approval of a $24.6 billion leveraged buyout he has proposed with the private equity firm Silver Lake.

"The decision is now yours. I am at peace either way and I will honor your decision," Dell wrote in an open letter filed with the U.S. Securities and Exchange Commission early this morning.

The letter came after a day of significant developments in the ongoing drama surrounding the fate of what was once the world's largest supplier of personal computers. Dell and Silver Lake raised their bid by a dime to $13.75 a share in the hope of convincing the company's board to change some of the rules governing the shareholder vote. Naturally, that didn't sit well with Carl Icahn, the activist investor stalking the company with a competing shareholder proposal of his own. He resorted to writing verse on Twitter to make his case.

Without mentioning him by name, Dell criticized some of the proposals floated by Icahn, including the sale of assets and a leveraged recapitalization, saying they would be "destructive to the company." Should the buyout be rejected by shareholders, he said he won't support any of Icahn's proposals. Dell remains the company's largest single shareholder, with about 14 percent to 15 percent of the shares outstanding.

Dell also reiterated the case he and Silver Lake made in a joint letter yesterday, saying the "non-vote-equals-no-vote" provision of the shareholder vote process is unfair. "Currently, over 25 percent of the unaffiliated shares have not voted," he wrote. "This means that even if a majority of the unaffiliated shares that vote on the transaction want to accept our offer, the will of the majority may be defeated by the shares that do not vote. I think this is clearly unfair."

The special committee of Dell's board hasn't yet formally responded to the latest offer.

Dell's full letter is below:

Dear Fellow Shareholders,

You have undoubtedly read many stories about our efforts to take Dell private. I wanted you to hear directly from me.

I believe that taking Dell private is the right thing to do for the company. We need to transform, and we need to do it quickly. The transformation is not without risks and challenges, and I believe that we can do what we need to do better as a private company than a public company.

When I came to the Dell board last August to ask if the board would consider the possibility of a going private transaction, I understood that the independent directors would control the process, and I made clear that I was ready to partner with whoever would pay the highest price. I encouraged every interested party to pay the highest price they could.

After one of the most thorough processes in history, the highest price that any of the parties was willing to pay was $13.65 per share. Although no other party has offered to pay more than $13.65 per share, Silver Lake and I have now increased our offer to $13.75 per share, an increase to public shareholders of approximately $150 million, which is our best and final offer.

I believe this offer is in the best interests of the company and our shareholders. Certain other parties have been proposing alternatives such as leveraged recapitalizations, sales of assets and other steps that I believe would be destructive to the company and that I do not and will not support.

The decision is now yours. I am at peace either way and I will honor your decision. Our agreement requires the vote of a majority of the unaffiliated shares - your shares - to approve the transaction. Unfortunately, our agreement also provides that shares that do not vote count as votes against the transaction.

Currently, over 25 percent of the unaffiliated shares have not voted. This means that even if a majority of the unaffiliated shares that vote on the transaction want to accept our offer, the will of the majority may be defeated by the shares that do not vote. I think this is clearly unfair.

When we offered to increase our bid to $13.75 per share, we also asked the Special Committee of the Board to change this unfair vote standard and allow the will of the majority of the unaffiliated shares that vote on the transaction to control the outcome.

Particularly given the efforts of others to promote alternative transactions, and the ability of those parties to vote their shares when my shares do not count, it makes no sense whatsoever to skew the playing field even further by counting shares not voting as if they supported the opposition group.

If the Special Committee agrees to our increased bid of $13.75 per share, and agrees to create a fair and level playing field in which you can decide, I will look forward to your decision.

Sincerely,
Michael S. Dell

China Apparently Takes Apple Off Procurement Lists In Bid To Limit Overseas Influence

NetSuite Q2 Earnings Beat Street Estimates Handily

Netsuite, the cloud-based business software company, just announced its quarterly earnings for the period ended June 30, and they reflect why the company's shares have been one of the best performers on the New York Stock Exchange this year.

On a non-GAAP basis, Netsuite reported per-share earnings of five cents on sales of $101 million. That was better than what analysts had expected: Two cents per share on sales of $100.6 million. Sales rose 35 percent from the year-ago period.

Recurring revenue, a key metric for cloud software companies that sell their software on a subscription basis, grew 39 percent. Sales through resellers - or "channel partners," in industry parlance - grew 70 percent.

"If there was any question that mission-critical business applications were moving to NetSuite, this quarter should provide the answer," CEO Zach Nelson said in a statement. Just today, the company said that Hailo, the company behind the taxi-hailing app, had become a customer.

Always quick to point out where his main rival is tripping up, Nelson compared NetSuite's results to those of the German business software giant SAP, which fell by about 7 percent year on year in its most recent quarter.