The special committee of the board of Dell Inc (NASDAQ:DELL) announced that Michael Dell and Silver Lake Partners increased their buyout proposal for the company to $13.75 per share, a dime higher than its original bid at $13.65 per share. The scheduled meeting was also postponed until August 2.

Carl Icahn

Carl Icahn to issue vitriolic rebuttal

The new Michael Dell/Silver Lake proposal has a condition. It requires Dell Inc (NASDAQ:DELL) not to count un-voted shares as “no” on their bid. Analysts at Topeka Capital Markets strongly believe that Carl Icahn will issue a “vitriolic rebuttal” against the new Michael Dell/Silver Lake offer.

In his latest regulatory filing with the Security and Exchange Commission (SEC), Icahn reiterated his argument that the special committee is using scare tactics in the “Dell Debacle.” He also describes it as a startling example of “unconscionable boards” and “self-congratulatory champions” of Dell Inc’s (NASDAQ:DELL) shareholders. The activist investor also urged the special committee to allow shareholders to finally cast their votes today, July 24.

New requirement under the revised proposal

According to Brian White, an analyst at Topeka Capital Markets, the new requirement under the revised proposal of Michael Dell/Silver Lake increases their odds to win because it would eliminate the rule that “not voted” shares be counted as “vote against the merger.”

In its letter to the special committee of Dell Inc (NASDAQ:DELL), Michael Dell and Silver Lakes’ Egon Durban wrote, “This is our best and final proposal. We are not willing to discuss any final increase in the merger consideration nor are we willing to increase the merger consideration to $13.75 per share without the change to the Unaffiliated Stockholder Approval requirement…”

In a note to investors, White speculated, “We expect Carl Icahn to shoot back a vitriolic rebuttal to this new proposal this week. Keep in mind, Carl Icahn released a letter to shareholders on July 12 that included a sweeter proposal. Under Mr. Icahn’s proposal, Dell would “self-tender” 1.1 billion shares (~71% of stock) in exchange for $14 per share plus shareholders would receive one transferrable warrant (with an exercise of $20.00 for seven years) for every four shares purchased in the tender offer.”

White noted that the estimated value of Icahn’s offer for the shareholders of Dell Inc (NASDAQ:DELL) is around $15.50 to $18 per share, significantly higher than the $13.75 per share revised offer of Michael Dell/Silver Lake.