Microsoft is in discussions to invest between US$1 billion ($1.2 billion) and US$3b of mezzanine financing in a buyout of Dell, CNBC cited unidentified sources as saying on Tuesday.
Private equity outfit Silver Lake Partners is trying to finalise a bidding group to take the world's No 3 PC maker private, and has opened discussions with potential equity partners, sources familiar with the matter have said.
Dell also has formed a special committee to take a close look at any potential deal on the table, multiple sources with knowledge of the matter told Reuters. If successful, it would be one of the largest corporate buyouts since before the global financial crisis.
Microsoft, which accelerated its foray into computer hardware in 2012 with the launch of the Surface tablet, will provide the capital in the form of mezzanine financing according to CNBC, which is a hybrid of debt and equity.
Microsoft and Dell both declined to comment on the CNBC report. Shares in Dell gained climbed 2 per cent to US$13.08 in late morning trade.