Share “Icahn contests condition in latest Dell offer”

Icahn contests condition in latest Dell offer

Published on NewsOK Modified: July 29, 2013 at 3:17 pm •  Published: July 29, 2013
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Billionaire investor Carl Icahn is renewing his attack on Michael Dell's leadership and warning that the latest offer from Dell to buy the struggling PC maker he founded bypasses an important shareholder safeguard.

Icahn and the investment firm Southeastern Asset Management said Monday in a letter to a special committee of Dell Inc. board members that Michael Dell wants to circumvent the voting process behind a deal by preventing stockholders from passively rejecting his offer.

Icahn and Southeastern are major Dell shareholders who have been leading a push to defeat Michael Dell's takeover plan. They also want Michael Dell ousted as the company's leader.

To that end, Icahn raised the acrimony by telling shareholders in a separate, open letter Monday that the struggling PC maker has a major liability that can easily be removed to improve company value.

"If Dell can replace Michael Dell, I think that the company would be worth far, far more," Icahn wrote.

A Dell spokesman declined to comment on Icahn's letters.

Last week, a group led by Michael Dell and the investment firm Silver Lake Partners raised its buyout offer for the Round Rock, Texas, company to $13.75 per share, up a dime from $13.65.

But they also want a change in the voting rules. They say the offer's fate must be decided by the shareholders who choose to vote either in favor of the plan or against it.

Under the existing rules, non-voting shareholders are counted as opponents of the proposal.

Icahn and Southeastern said in their letter to the board that they believe many Dell stockholders who oppose the deal may have not voted because they knew their inaction would count as a vote against the merger. They say the group led by Michael Dell is now essentially offering to pay a dime per share for a new voting method that prevents those stockholders from rejecting the deal.

"We trust that you will see this for what it is and recognize that proper protections for stockholders of Dell should not be offered for sale to anyone at any price," the letter stated, adding that the standard for approval that counts non-voting shares is perhaps the only safeguard for shareholders included in the deal.

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