Dell Blasts $3.9 Billion Hole In Icahn Plan

Jun 6 2013 | 11:30am ET

Dell Inc. sharpened its criticism of Carl Icahn's proposed leveraged recapitalization of the company, telling investors that Icahn's proposal has a $3.9 billion funding shortfall.

The estimated gap means that Icahn and his partners, Southeastern Asset Management, would only be able to pay between $8.50 and $9.35 of the proposed $12 per share dividend that would give them control of the computer-maker. Dell last week set a vote on the $24.4 billion buyout led by founder Michael Dell and private-equity firm Silver Lake Partners, urging shareholders to support it.

Icahn's offer is "unrealistic" and would fund the dividend with Dell's cash and $5.2 billion in debt. But Dell said that Icahn has overestimated its liquidity, projecting $17.3 billion where there is only $13.4 billion.

Icahn has threatened a legal and proxy battle.

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