Remember meForgot password?
    Log in with Twitter

article imageDell committee agrees to founder's offer to take company private

By Paddy Reid     Aug 2, 2013 in Business
Round Rock - Michael Dell’s hopes of being allowed to take the company he founded private received a boost on Friday after a special committee of Dell’s board agreed to accept an increased offer that would see the tech mogul tack a dividend to his original offer.
Michael Dell, along with partner firm Silver Lake, last week offered to buy the company at a price of $13.75 per share. The revised offer will see an extra 13c paid out to shareholders for each share owned, CNET reports.
As part of the augmented deal, Michael Dell will be allowed to avail of new, more favourable voting rules. Before, ballots which had not been marked because their holders abstained counted as votes against; the new rules will see abstainers not counted. Experts believe that the new paradigm will force those in the middle to climb down from the fence or withdraw their vote, conditions which are expected to benefit Michael Dell’s bid, says the Financial Times.
“The committee is pleased to have negotiated this transaction, which provides as much as $470 million of increased value, including the next quarterly dividend that will now be paid regardless of when the transaction closes,” commented Alex Mandl, Chairman of the Special Committee.
Mandl also expressed his delight at the new voting system proposed by Michael Dell, saying that it provides a “level playing field” for shareholders. He explained that the original system was designed to facilitate a vote on whether to accept a bid or to maintain the status quo, and that it was not suitable for a straight yes/no ballot.
The new offer was approved just 30 minutes before shareholders were due to meet, most likely to reject the offer. Since, several angry shareholders have voiced criticism of the board’s handling of the offer, claiming that some of its members openly displayed favouritism for Michael Dell, ignoring other options.
Among the shareholders to voice their anger was Carl Icahn, who had tabled an alternative offer in conjunction with property firm Southeastern Asset Management. Icahn, who announced his intention to sue Dell on Thursday in an attempt to prevent the company from changing the recorded date of Michael Dell’s first offer, criticised the offer for falling short of what investors should have been offered.
The vote that took place on Friday had already been delayed twice as Michael Dell could not rally enough support to make a count worthwhile.
The ballot on whether or not Michael Dell will be allowed to take the company he founded as a teen private will take place on September 12, Bloomberg reports.
After the announcement was made by Dell’s board, shares in the company rose by more than 5 per cent – or 64c – to $13.65, a three-month high.
More about Dell, Michael dell, silver lake
More news from
Latest News
Top News