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09 Sep 2008
Dell chief executive Michael Dell has splashed out $100m (£57m) on shares in his company as rival Lenovo claimed it has no plans to buy Dell's factories.
Dell bought 3.5 million shares on Thursday at a cost of $20.42 each. He added a further 1.38 million on Friday at a price of $20.67 apiece. He now owns 255.5 million shares in the company he founded, which is about nine per cent of the vendor's stock.
His latest outlay was revealed in a Federal filing yesterday and the company's stock leapt three per cent in after hours trading. This was welcome news for investors as stock had fallen more than 20 per cent after the vendor missed Wall Street's profit estimates in results published last month.
Further reading
The Wall Street Journal reported last week that the PC titan planned to offload most, if not all, of its factories as part of a cost-cutting drive. The story claimed the company had already approached several contract manufacturers with a view to outsourcing production of PCs.
A report to the Securities and Exchange Commission filed by Dell last week said: "We are actively reviewing all aspects of our logistics, supply chain and manufacturing footprints.
"We continue to evaluate and optimise our global manufacturing and distribution network, including our relationships with original design manufacturers."
William Amelio, chief executive of rival Lenovo, told reporters in Singapore earlier today that his company has no plans to purchase any of Dell's factories. He indicated that Lenovo already had enough manufacturing capacity.
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