Michael Dell Returns To CEO Spot

Feb. 1, 2007
Stock rose 4% on announcement.

Michael Dell, on Jan. 31, resumed command of the computer company he founded in 1984, taking back control of the struggling firm from a successor he anointed. Dell's return to the chief executive position at the company that bears his name caused its stock to rise more than 4% in after-hours trading. Dell replaced 54-year-old Kevin Rollins, who resigned effective immediately.

In the nearly three years that Rollins headed the Texas-based firm, it lost its dominant position in computer sales to California-based rival Hewlett-Packard and came under scrutiny for questionable accounting practices. Regulators and prosecutors are investigating indications that the company misstated items in financial reports. The firm's chief financial officer James Schneider "retired" abruptly in December.

"There is no better person in the world to run Dell at this time than the man who created the direct model and who has built this company over the last 23 years," said Samuel Nunn, head of Dell's board of directors. "The board believes that Michael's vision and leadership are critical to building Dell's leadership in the technology industry for the long term."

The tactic that Dell innovated when he started the company shipped the firm's computers directly to users, eliminating stores or other "middle men." Dell created the company with $1,000 and served as its chief executive from its inception until he handed the reins to Rollins in 2004.

"Dell has tremendous opportunities ahead of it," Dell said in a release on Jan. 31, adding he was optimistic about the company's prospects with new-generation online trends referred to by the buzz-phrase Internet 2.0."

Along with announcing the transfer of power, the company lowered its revenue and earnings estimates for its fourth fiscal quarter, the results of which are to be reported in March.

Copyright Agence France-Presse, 2007

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