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NEW YORK — Struggling computer maker Dell Inc. announced Tuesday it will use some of its cash stockpile to pay shareholder dividends as it pursues a shift to services.
Chairman and CEO Michael Dell told CNBC that in view of the PC maker’s cash position and a shift to a more diversified business model, “We feel confident this is a great time to return this capital to shareholders now in perpetuity.”
The company will pay 32 cents per share annually, amounting to an annual expense of $560 million, from a cash stockpile of $17.2 billion.
Jon Ogg of 24/7 Wall Street said the move was long overdue and follows similar moves by other tech firms, including Apple Inc. and Hewlett-Packard Co.
“Dell has been part of our technology dividend sinners for quite some time,” Mr. Ogg said. “It is now finally changing its policies and will start to unlock that shareholder value by paying a dividend to its common shareholders.”
Dell shares rose 0.93 percent to $11.97 and added another 2.7 percent in after-hours trading. But the shares are down from over $30 in 2007.
The company said in a statement that it was taking steps to boost shareholder value through stock buybacks and the new dividend, and that it would be expanding its services to be more diversified.
• From wire dispatches and staff reports
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