Michael Dell and private equity firm Silver Lake Partners have reportedly decided against raising their $24.4bn (£16.4bn) bid to take the company private as investors lose interest in the plan.
Reuters reported the news late on Friday British time, after Dell shares fell three per cent to $12.89 each on the Nasdaq in response.
According to the newswire, the currently "deteriorating outlook" for the PC industry means investors do not favour such a deal.
"Dell's board has grown skeptical of the prospects of Michael Dell's bid after recent meetings with major investors, and has advised Dell (pictured, right) to raise the bid if he wanted the deal to go through, sources familiar with the matter previously said," claimed Reuters.
A shareholder meeting where investors will vote on the deal is scheduled for 18 July.
Bloomberg reports that adviser Institutional Shareholder Services, which releases a key report on the deal this week, is likely to recommend a vote against.
About a week ago, current shareholder Carl Icahn, described by Cnet.com as an "activist investor" and by Forbes Magazine as "Wall Street's richest man", with Southeastern Asset Management, offered 1.1bn in shares, at $14 each – or $16bn – to buy about 58 per cent of the struggling company.
Icahn's argument is that Dell's offer, which had initially been looked on favourably, undervalues the company.
"Icahn's proposed tender offer will be financed with $7.5bn of cash on the balance sheet, [a] $5.2bn credit facility and $2.9bn from the sale of receivables," Reuters wrote at the time.
Icahn has been reported on CNBC as saying: "What I've found over the years is that when people tell you it's no good, that's when you buy."
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