Dell Vote Delayed As Bidders Boost Offer Slightly

Jul 24 2013 | 12:03pm ET

Michael Dell and private-equity firm Silver Lake Partners have increased their bid for—and the drama surrounding—the computermaker he founded.

Dell and Silver Lake announced that they would pay $200 million more for the company, or ten cents per share. But they also insisted that Dell Inc. change the rules for voting on the bid to make it easier to succeed—and that the special committee of Dell's board handling the sale approve those new terms by 6 p.m. today.

If the special committee does not do so, the new, higher offer will expire.

"We believe these amendments are fair and in the best interests of the company's unaffiliated stockholders and provide the best alternative to the special committee to maximize shareholder value," Michael Dell and Silver Lake's Egon Durban wrote yesterday.

The committee is seen as unlikely to accept the officer; it has been pushing for a $14 per share offer—matching the proposed buyback plan floated by the buyout's chief opponent, Carl Icahn—in exchange for changing a rule that counts shares not voted as "no" votes. The committee did postpone the voting deadline for the second time, giving investors until Aug. 2 to vote their shares.

Some 27% of shares remain outstanding; those that have been voted are roughly split between "yes" and "no." "The presumption that these shares should be treated as if they had voted against the transaction"—as Dell and Silver Lake originally agreed—"is patently unfair," they now hold.

For his part, Icahn chose to express his growing confidence in verse, posting on Twitter, "all would be swell at Dell if Michael and the board bid farewell."

"This latest change is a transparent attempt to force their freeze-out transaction across the finish line despite the vote of its stockholders," Icahn said in a statement later.

Silver Lake is said to be steadfast in its refusal to raise the bid to $14 per share.


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