Taking Microsoft private, though a far-fetched idea, is something “in the back of people’s minds” at the company, says Bill Koefoed, general manager of investor relations at Microsoft. He adds, “We’ve thought about it.”This surprising admission was revealed on Brier Dudley’s Seattle Times blog who ran a story about how Microsoft could take itself private if it wanted to.
Brier says Microsoft would have to borrow $225.5 billion to make it happen. If it could borrow money at the favourable terms it got for its recent debt raise, interest on the loan would be about $1.21 billion per month. Since it earns $2 billion per month in profits, it could afford that interest rate.
Why go to the trouble?
- Microsoft wouldn’t have to deal with investors complaining about the flat stock price.
- Instead of giving investors dividends, it could use that money to make more employees millionaires.
- It could potentially protect Microsoft from the next CEO who might listen to bad ideas from Wall Street and destroy the company.
Of course, for this plan to work, Microsoft would need Ballmer and Gates on board. Neither of them want to do it, so it’s dead in the water. But, it does make for a fun thought experiment.
See Also: 10 Reasons You Should Love Microsoft