Channel Cheers Icahn's White Flag In Dell Leveraged Buyout Bid

Carl Icahn has thrown in the towel on his bid to take control of Dell

Icahn opposed the $24.8 billion leveraged buyout plan put forth by Michael Dell and Silver Lake Partners. But the billionaire investor abandoned his own plan for Dell Monday morning, declaring in a shareholder letter that it was "almost impossible" to win the stockholder vote scheduled for Sept. 12.

"This is great news. It's been dragging out for too long," said Paul Clifford, president of Davenport Group, a St. Paul, Minn.-based solution provider and Dell partner. "It's been hurting Dell, hurting customers, and partners like us."

[Related: Carl Icahn Throws In Towel On Dell Fight ]

Icahn never had channel partners' interests in mind, Clifford said. "With Icahn it was always about bringing shareholder value, and partners were an afterthought -- if that," he said.

This lifts the cloud that was hanging over Dell and gives Dell founder and CEO Michael Dell running room to execute on his vision for the company, Clifford said. "We were waiting for clarity and today that's what we got," he said.

Brian Goddard, president of GTechServ, a Dell partner headquartered in Charlotte, N.C., also cheered the news and said Dell is better off in Michael Dell's hands rather than Carl Icahn's.

"We're very excited, and we're glad to see this is over," he said. "We've had a relationship with Dell for over a decade and they've been a great partner for us, but if this had gone the other way, we would have had to move to another vendor."

In a statement on Monday morning, Icahn said he still opposes the Michael Dell/Silver Lake proposal but will no longer pursue efforts to defeat it. Icahn began fighting a bitter battle to keep Dell public several months ago, buying 9 percent of Dell shares and declaring his intent to oust CEO Michael Dell from the company.

Bob Venero, CEO of FutureTech, a Holbrook, N.Y.-based solution provider with a robust Dell business, said he sees more opportunity for growth with Dell going private.

"There is no question from a partner perspective there is a major opportunity in working with Dell, not only pre-public but even more so in a post-public environment. Michael (Dell) has doubled down and shown his dedication to the channel. With every acquisition he's turned to the channel immediately. From Equallogic to Compellent to Qwest, every acquisition from day two has been channel ready."

Venero said the "flexibility" that comes from Dell going private is going to allow the company to move quicker to work hand in hand with partners to deliver compelling enterprise solutions.

"From my perspective, Dell will now be able to focus more on ingenuity, innovation, on things that are going to differentiate Dell in the market because they will no longer have to be focused on having to hit that quarterly number every quarter, quarter after quarter," he said. "Now Dell will longer have to deal with the emotional aspects of a being a public company. Emotions often drives the buying and selling of stocks rather than strategy, focus and direction."

Goddard said his company has bought into Michael Dell's vision for the company "hook, line and sinker," and he credited the company's leadership for expanding the product line and putting a stronger focus on complete solutions.

"It takes a while to turn a big ship like Dell, but they've made a lot of progress," Goddard said. "We're selling solutions today instead of just pushing hardware, and that's a credit to Dell."

Michael Dell, for his part, said in a letter to Dell employees in April that the leveraged buyout scenario would allow the company to invest more in its Partner Direct program and solution providers.

"Our goal is to increase sales coverage and expand the depth of partnerships with channel partners in our Partner Direct program. We also expect to significantly increase investment in training for both new and existing sales personnel, including our channel partners," he wrote.

The leveraged buyout would also allow Dell to make significant investments in research and development, capital expenditures and other personnel additions, Dell wrote.

ADDITIONAL REPORTING BY TOM SPRING AND ROB WRIGHT