Dell Set To Delay Deal Vote Again

Jul 23 2013 | 2:42pm ET

Dell Inc. appears poised to postpone a shareholder vote on its proposed $24.4 billion private-equity-backed buyout as fissures emerge among the troubled computermaker's would-be owners.

Stockholders were to vote by last Thursday, but Dell adjourned the meeting until tomorrow, hoping to persuade skeptical investors to accept the deal. Some 22% of eligible shares were not voted by last week's deadline, and a further extension would indicate that the deal still lacks the necessary support.

Should the deal fail, it's not clear how much Silver Lake Partners, which is working with company founder Michael Dell to buy the eponymous company, would be entitled to. The p.e. firm believes it should get a $450 million breakup fee if an alternative plan pushed by Carl Icahn—a $14 billion share buyback program—succeeds within a year. Michael Dell and the special committee of Dell's board disagree, arguing that Icahn's plan isn't a competing buyout offer, and that Silver Lake would be entitled only to its expenses.

For his part, Icahn is keeping up his attacks on the deal in another open letter to the special committee, calling it "one of the most startling examples" of "unconscionable boards" of directors.

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