Founder of Dell Computers, Michael Dell bought shares worth $100 million in his own company, reiterating confidence in the computer giant’s business.
Securities and Exchange Commission (SEC)were notified of the deal after the transaction took place on Friday.
Mr. Dell becomes the largest shareholder in the company with a holding of 263 million shares valued at $3.5 billion. He bought 7.37 million shares at $13.57 a share in the latest transaction.
Dell’s share price fell by 7% this year and Michael Dell said some shareholders were undervaluing his company. However, the news failed to cheer the market and the stock closed 2.1% down on Monday.
The company registered strong growth in the third quarter with net income posting a solid growth of 144% to $822 million (£511 million). The company attributed the strong bottom-line to falling costs and a wave of hardware upgrades by companies as the world economy slowly starts expanding.
Strong corporate demand ensured revenue grew by 19% in Q3 2010 over same period, last year. However, retail demand still remained weak and posted a growth of just 4%.
This the third occasion in less than three years when Michael Dell has bought shares of Dell computers. In 2008 July, he paid a total of $99.7 million at $22.14 per share. Two months later, he spent another $100 million in two separate transactions at an average price little over $20 for each share. The latest buy seems to be a bargain compared to previous transactions. He now holds around 12 percent share in the company valued at $3.5 billion.