Icahn Waves White Flag In Dell Fight

Sep 10 2013 | 3:48pm ET

Carl Icahn still doesn't like the $24.8 billion deal to sell Dell Inc. to its founder and a private-equity firm. But he knows when he's licked.

Icahn wrote to Dell shareholders yesterday to admit defeat, saying that while he still thinks the agreement between Dell, Michael Dell and Silver Lake Partners "greatly undervalues" the company, he has "determined that it would be almost impossible to win the battle on Sept. 12," when shareholders are expected to vote to approve the deal.

Icahn acknowledged his stinging defeat in Delaware Chancery Court last month crippled his bid to block the deal. Chancellor Leo Strine effectively blocked Icahn's effort to overturn Dell's agreement to change the voting rules in exchange for more money and to force an early general meeting at which Icahn hoped to depose Dell's board.

Icahn did say he would continue to seek appraisal rights in court, which could force Dell and Silver Lake to pay even more. Icahn owns some 8.7% of Dell shares.

And while pledging to call Michael Dell "to wish him good luck"—a call that had not happened as of Icahn's mid-day interview on CNBC yesterday—the veteran dealmaker couldn't help but get a few last swipes in, comparing the company's board to Russian President Vladimir Putin.

"We jokingly ask, 'What's the difference between Dell and a dictatorship?' The answer: Most functioning dictatorships only need to postpone the vote once to win," he wrote, referring to Dell's decision to extend voting several times when it was clear the deal did not have enough support.

"The Dell board, like so many boards in this country, reminds me of Clark Gable's last words in 'Gone with the Wind,' they simply 'don't give a damn,'" Icahn continued, closing with a  plug for himself. "If you are incensed by the actions of the Dell board as much as I am, I hope you will choose to follow me on Twitter where from time to time I give my investment insights."


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