Carl Icahn And Southeastern Ask Shareholders To Reject Dell Buyout

By Mani
Updated on

Carl Icahn and Southeastern Asset Management have urged Dell Inc. (NASDAQ:DELL) shareholders to vote against buyout proposals sponsored by the company.

Carl Icahn And Southeastern Ask Shareholders To Reject Dell Buyout

The Delaware-based activist investor and the Tennessee based asset management company in their Thursday’s filing with the Securities and Exchange Commission, believe that Dell Inc. (NASDAQ:DELL) shareholders should be able to remain holders of Dell Inc. (NASDAQ:DELL) common stock and oppose the cash out merger at $13.65 per share agreed to in the merger agreement proposed by Dell Inc. (NASDAQ:DELL).

Carl Icahn Urged Shareholders To Vote Against Proposal

Carl Icahn and Southeastern Asset Management, Inc.  have indicated in their SEC filing that they don’t believe the proposed $13.65 per share properly reflects the value of Dell Inc. (NASDAQ:DELL) and urged its shareholders to vote against the proposal.

The activist investor and the asset management company also asked Dell Inc. (NASDAQ:DELL) shareholders not to approve on a non-binding advisory on the compensation payable to the named executive officers of Dell Inc. (NASDAQ:DELL) in connection with the merger.

The duo also urged Dell Inc. (NASDAQ:DELL) shareholders to vote against the other two proposals relating to proposal to approve adjournment of special meeting and proposal to grant authority to act upon other business.

Dell Inc. (NASDAQ:DELL) has accepted the $13.65 all cash offer from Michael Dell and Silver Lake Partners. This offer was quickly rejected by Southeastern Asset Management Inc., which is Dell Inc. (NASDAQ:DELL)’s largest non-insider shareholder with about 8.2 percent holding.

Earlier Carl Icahn and Southeastern proposed an alternative offer to a $24.4 billion deal to buy out Dell Inc. (NASDAQ:DELL)  public stockholders, saying they propose giving Dell Inc. (NASDAQ:DELL)  shareholders the option to keep holding stock in the company, and take an additional $12 a share in cash or stock. The cash-or-stock dividend would cost more than $21 billion.

Offer By Carl Icahn and Southeastern

The counter-offer from Icahn and Southeastern has been rejected by Dell Inc. (NASDAQ:DELL)’s board of directors, as they believe the company’s financing for the deal is undercapitalized by $3.9 billion.

Today’s filing from Icahn and Southeastern comes after the slide show filed with the SEC yesterday by Dell Inc. (NASDAQ:DELL)’s special committee told the Dell Inc. (NASDAQ:DELL) shareholders that Icahn and Southeastern have greatly underestimated the amount of cash that will be needed in order to finance their offer.

The proposals would come for voting at Dell Inc. (NASDAQ:DELL)’s annual meeting currently scheduled for July 18.

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