Chinese Government Seen Killing Dell Deal

Shares of computer and server maker Dell took a slight dip after an analyst suggested the Chinese government put the kibosh on a rumored agreement for Dell to buy Beijing-based Founder Electronics' PC division.

ThinkEquity analyst Eric Ross, who has a "Sell" rating on the stock, said that even though the acquisition would make strategic sense, and despite various reports that Dell would buy the division for anywhere from $400 million to $800 million, he doesn't think it will happen.

"Our sources close to the deal indicate it will not occur, killed by pressure from the Chinese government," Ross wrote in a note to investors. "Additional rumors have circulated that China's state-run Haier Group would buy the PC division."