The dark satanic rumour mill has been manufacturing a hellish yarn which claims that Microsoft is considering going private.
On paper it looks like a good idea. Microsoft would have to borrow $225.5 billion to make it happen and it would not have to give any more money to whining shareholders or listen to Wall Street. Employees would make a hell of a lot of money and the Imperium could have total control of its finances.
Ideas like this are fairly fashionable at the moment. Michale Dell has been seriously thinking about it and is going to discuss it at his next board meeting.
Brier Dudley’s Seattle Times bog heard one of the rumours and asked Bill Koefoed, general manager of investor relations at Microsoft if there was any truth in it.
Koefoed said that it was not as far fetched as it sounded and was something “in the back of people’s minds” at the company. Apparently the Imperium has thought it through.
Firstly it would require Microsoft to borrow money at the same favorable terms it got for its recent debt raise. The interest on the loan would be about $1.21 billion per month which is doable because it earns $2 billion per month in profits,
But what is scuttling the plan is Ballmer and Gates would have to back it. Apparently neither of them think it is a good idea. In fact for it to work they would have to hang onto their shares. Recently they have been flogging them off.
This selling of shares indicates that making Microsoft private is just the sort of mental exercise you do when it is holiday season in the US and there is no news.