Ever since Michael Dell bought out his computer company two years ago, he has been trumpeting the virtues of private ownership. “As a private company, Dell now has the freedom to take a long-term view,” he wrote in a Wall Street Journal op-ed last year. “No more pulling R&D and growth investments to make in-quarter numbers. No more having a small group of vocal investors hijack the public perception of our strategy while we’re fully focused on building for the future.” He has reason to be pleased.
His business is kicking off more than $2 billion in free cash flow each year, and he is using it to chip away at the $18 billion in debt he and private equity partner Silver Lake Management assumed when they took control over the company in 2013. Dell started the computer giant at age 19 in his Texas dorm room with $1,000. Four years later, it went public with a market capitalization of $85 million. By the time he took it private again in 2013, the company was worth $25 billion.
He still holds a 70% stake but keeps most of his fortune in his private investment firm MSD Capital, whose wide array of investments includes car deal Asbury Automotive, PVH Corp. (parent to Tommy Hilfiger and Calvin Klein) and DineEquity (operator of IHOP and Applebee’s).