Carl Icahn’s attempt to push back the shareholder vote on the future of Dell Inc. (NASDAQ:DELL) has been denied fast-track treatment in Delaware’s Court of Chancery. He is claiming that the decision to have shareholders vote on Michael Dell’s buyout offer before voting on his own plans for the company amount to coercion, but the judge saw no proof of wrongdoing, Peg Brickley of The Wall Street Journal reports.
“I don’t find any color to the fiduciary duty claim or any threat of irreparable injury that justifies expediting those claims,” said Chancellor Leo Strine.
Icahn pushing for votes to happen simultaneously
Company founder Michael Dell and the private equity firm Silver Lake want to take the firm private, and a special committee formed by Dell’s board decided to hold a shareholder vote on the offer on September 12, more than a month before they will have the opportunity to vote on Icahn’s counter-proposal to replace the existing board, payout shareholder dividends, and attempt to bring the company around while still publicly held. This vote will take place at the annual shareholders meeting on October 17, assuming the company hasn’t gone private by then. Icahn wants the votes to be held simultaneously.
Icahn shot down on moving his proposal up one month
Strine seems to think that shareholders are aware of both offers and the one month separation won’t prevent them from voting in their best interests, and that Icahn ought to be fighting his case in front of shareholders not in front of the court. “I think the special committee would dance in the streets if the Icahn group would make a topping bid that was firmly financed and would buy out everybody’s shares at a greater price,” he said.
This decision doesn’t mean that the complaint is being thrown out entirely, but based on the judge’s comments Icahn can’t be feeling hopeful. Strine suggested that even if Icahn wins the argument the most likely outcome will be a court decision that the annual shareholders meeting be held on October 17, the date that’s already set, effectively changing nothing.
News that the judge had ruled against Icahn caused a small rally for Dell Inc. (NASDAQ:DELL) stocks bringing them up to $13.81 per share.