The pronouncements that M&A was finally back disappeared in March. While deals were bigger in Q1 than in the first quarter of 2012, there were fewer of them, according to preliminary data from Dealogic. Global activity was down 32% year-on-year, and the number of US deals fell by 24%.
But there’s even stronger proof of the slow deals environment than those statistics—the business media has become all Dell, all the time. Since last weekend, there have been more than 70 stories written on Dell by seven of the largest mainstream March 28, 2013 " rel="no follow">business news organizations.
True, the dynamics of the Dell buyout are unusually dramatic. At first, despite some shareholder opposition, it seemed that the company’s founder and CEO, Michael Dell, along with private equity firm Silver Lake and Microsoft, would still prevail in the $24.4 billion buyout. But that changed when private equity firm Blackstone showed interest, and activist investor Carl Icahn also piped up. Both then submitted tentative offers for the company, leading the special committee of Dell’s board to declare on March 25 that the proposals could reasonably lead to superior offers. That meant that Dell had to hold talks with Blackstone and Icahn to see if they could lead to a firm bid.
The specter of a rare but possible bidding war between private equity firms after a “go shop” (the period in which sellers can solicit higher offers), the Carl Icahn card, and the Michael Dell factor all have made the situation pretty intriguing.
But not necessarily 70-articles-in-one-week intriguing. With no other big deals to dissect, however, the business media has turned its Dell coverage into a full-fledged obsession.
Headlines are now sounding like the study hall buzz about who’s “in” and “out” in a high school clique. One moment, Michael Dell is revealed to have an enduring fondness for former Dell executive Dave Johnson, despite that Johnson is now at Blackstone. Not so, dishes the next scoop—Dell loathes Johnson. And while one story will insist that Blackstone’s keeping Michael Dell if the board takes its offer, another assures that Blackstone will dump Michael Dell straight away.
And on and on it goes. Dell is likely to file its proxy tomorrow, which will reveal details of its merger talks with Michael Dell et al., as well as of the go shop process. So expect a fresh gush of stories.
Of course, this isn’t entirely the business media’s fault. Many reporters find it just as wearying to write as it is to read. (Full disclosure: Quartz has also written some Dell stories. And even fuller disclosure: In a previous life, I too would’ve been writing about every turn of the screw.) But even with a scarcity of deals, they still have to feed the beast.
So this is a plea to companies other than Dell: please announce a sale or acquisition. And dealmakers, please leak another deal. Otherwise, this M&A drought means even more Dell-mania. And it will be weeks before that situation is resolved.
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