Maureen O'Gara

The Blackstone Group, the big private equity house said to be seriously mulling “various scenarios” for a counterbid for Dell that trumps Michael Dell and Silver Lake Partners’ $24.4 billion offer, is supposedly thinking about replacing Michael Dell as CEO if it bids and wins.

It has reportedly “aggressively” approached an obvious choice, former HP CEO and current Oracle president Mark Hurd, who would have to bite the hand that salvaged him when he was down and out if he took the job.

He was saved from marginalization over an alleged liaison with a soft porn queen by Oracle CEO Larry Ellison, who’s got many girls to his credit and who made Hurd president of Oracle after HP foolishly dumped Hurd. He’s now seen as a possible successor to Ellison.

Bloomberg says Blackstone hasn’t made Hurd a formal offer yet.

Blackstone has also reportedly considered former Compaq chief Michael Capellas, lately chairman of the Cisco-EMC venture VCE. Capellas, who sold Compaq to HP, was a senior advisor to Kohlberg Kravis Roberts & Company (KKR) last year when it considered a Dell bid before abandoning the idea.

Blackstone would theoretically have to sweeten the current Silver Lake bid before Friday ends. Actually it only has to indicate it’s interested.

Michael has told a Dell special committee that he’ll “remain available to work in good faith with any competing bidder” and “vote pro rata with the unaffiliated stockholders on any superior transaction recommended by the special committee or, at his option, in favor of such transaction.”

There’s no telling if he would actually partner with a rival bidder by agreeing to roll over his shares or by sticking around as CEO.

Fortune says Blackstone would like to have Michael on its side.

Under Michael’s deal he would take the company private and remain CEO. Without him Blackstone would have to cough up an extra $4.5 billion.

Blackstone has through Friday to make a move under a so-called go-shop provision and may decide to partner up, the Wall Street Journal said, at midnight Wednesday to buy all or part of the company. Its partner could be major Dell stockholders Southwestern Asset Management or TPG. It could also be satisfied with Dell’s financial services operation, the paper said.

Bloomberg says Blackstone has looked at Dell’s books under NDA as have HP, Lenovo and Carl Icahn and could form a consortium of rival investors.

If Dell and Silver Lake are outbid Bloomberg says it’s unclear if the company will go private as Michael is trying to do or stay public.

Dell’s share price is still almost a buck ahead of the $13.65-a-share price being offered.

The New York Times figures it’ll take $1.8 billion for each dollar the price rises or about another $2.3 billion to get to $15 a share.

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