Dell reportedly close to buyout

Round Rock, TX (KXAN) - A number of business news websites reported computer maker Dell was near a leveraged buyout deal late Monday that would take the Round Rock-based company private.

That news gave some in the fast growing city north of Austin pause since the move could change the way Dell operates, and how it structures its business divisions and offshoots.

If significant layoffs were to happen, it would no doubt have a ripple effect on Round Rock’s economy, particularly small, start-up businesses like Kim Dowdy’s year-old combination antique store and insurance agency along Round Rock's quaint main street. Here, Dowdy told KXAN, a portion of her customer base comes from Dell. Its sprawling campus is a scant two miles south.

Dowdy's been planning a wine and cheese event to draw more Dell employees for the longer term.

About 14,000 people work at Dell. Many built their family homes right in Round Rock which boasts new suburban golf course communities like Terravista to the north. Now, it's uncertain if major layoffs could be looming in the city one-time UT student Michael Dell picked more than decade ago to headquarter his PC business. The company has a market value of more than $23 billion.

Analysts expected the privatization deal with investment company Silver Lake Management LLC and Microsoft would allow Dell more flexibility to be daring and aggressive in an investment world where many large firms are controlled by shareholder votes.  Dell went public with an initial public offering in 1988 at $8.50 a share. It closed Monday on the NASDAQ at $13.27 a share.

And while there have been local layoffs reported as recently as last fall, Dell has invested 12 years in Austin and Round Rock.

Just last week, Dell spokesman David Fring said, "We have communicated to a limited number of team members around the world and in Central Texas about workforce actions as we continue to become more efficient. In Central Texas, we've actually added more people than actual layoffs -- by several hundred employees in the past year. We're continuing to hire as well."

The Dell stamp on the Williamson County community is undeniable, if the logo on the Triple-A Dell Diamond baseball park is any indication. Business leaders say there are other economic drivers in this city of 100,000. There's a Sears call center nearby, for example that employs 1,500 people according to the city website, but they say Dell is the true anchor business.

Doug Kurcul, President of the Round Rock Chamber of Commerce pointed out Round Rock is the second fastest growing city in the United States.

“That means we have a lot of good things going,” he said.

“Dell has been a large part of that and we see no reason to expect that will change.”

Kurkul also told KXAN he's confident Dell's broad community contributions will continue even as a privately-held company.

Just last week the Susan and Michael Dell foundation contributed $60 million to help establish UT's new medical school.