Watch Out, Michael Dell — Shareholders are Angry
By Aabha Rathee | February 13, 2013 8:18 AM EST
Michael Dell, founder and chief executive of the namesake company, secured a $13.65 per-share deal to take the computer manufacturer private. The valuation may be agreeable to Michael Dell, but many shareholders have found the terms of the deal to be unacceptable. In fact, they are fighting back.
Dell’s ( — Southeastern Asset Management, which holds an 8.44 percent stake in the company — wrote a letter to the board announcing that it would oppose the buyout plan in its current form when brought to a vote. In the firm’s estimation, the company’s worth is close to $24 per . According to The New York Times’ DealBook reporter Michael de la Merced, Southeastern said it would use a full range of tactics, including a proxy fight and lawsuits, to block what it termed an “ill-advised transaction.”
Southeastern disclosed in a on February 11 that it had if the deal is completed under the current terms.
Southeastern isn’t the only shareholder unhappy with the price. The voice money manager T. Rowe Price Group, which held a 4.4 percent stake in the company as of September 30, also announced that it would oppose the leveraged buyout offer proposed by and the private-equity firm Silver Lake.
“We believe the proposed buyout are expected to resist the buyout.
With an increasing number of shareholders speaking out against the buyout, Michael Dell should be concerned. Although he owns approximately 16 percent of the company’s , Dell’s offer for the computer manufacturer requires the approval of a majority of independent shareholders in order to be finalized.
In response the statements made by Southeastern and T. Rowe Price Group, Dell reiterated an argument it made on Friday. A spokesman for the company said that Dell’s board had examined several alternatives. “Based on that work, the board concluded that the proposed all-cash transaction is in the best interests of stockholders,” he said in the statement seen by the Times.
Shareholders will vote whether to approve the deal in several months.
Copyright Wall St. Cheat Street. All rights reserved.
Most Popular Slideshows
- Top 5 Richest Tennis Athletes
- Angelina Jolie & Brad Pitt Heads to Malta For New Movie After A Whirlwind French Wedding [PHOTOS]
- 2014 US Open Update (Day 4 - Men's Singles): Murray, Djokovic, Raonic and Isner Advance to 3rd Round [PHOTOS]
- Kate Middleton’s Mom Accused Of Being A Social Climber, Prince George Not Seen By Relatives
Join the Conversation
- Sept 19 iPhone 6 Release Date Confirmed as Apple Sets Sept 9 iWatch, 2 iPhones Intro - Report
- iPhone 6 Release Date Update: 4.7-Inch Model Scores 65.8% In Screen-To-Size Ratio; A Surprise Entry Scales Top Spot [List Attached]
- Product Recall Alert: Hewlett-Packard Pulls Out 6M Power Cords from US, Canada Over Fire Hazard Concerns, Australia Also Affected
- ISIS Wants $6.6M and Release of Aafia Siddiqui in Exchange of Head of Female US Humanitarian Aid Worker, 1st American Fighting for Jihadis Dead
- Canada Vs Russia War Erupts Via Twitter on Russia-Not Russia Maps
- Ukraine Ceasefire Looks Remote As Putin Talks Tough At Meeting With Poroshenko
- Windows 9 To Include Interactive Live Tiles and Notification Center in Metro 2.0