Breaking News Bar
updated: 3/13/2013 7:30 AM

Dell rejects request for info leading to buyout

hello
Success - Article sent! close
  • Dell has rejected a request from a shareholder rights group seeking to review the internal information that led to a proposed $24.4 billion sale of the struggling personal computer maker.

      Dell has rejected a request from a shareholder rights group seeking to review the internal information that led to a proposed $24.4 billion sale of the struggling personal computer maker.

 
Associated Press

ROUND ROCK, Texas -- Dell has rejected a request from a shareholder rights group seeking to review the internal information that led to a proposed $24.4 billion sale of the struggling personal computer maker.

In a letter Tuesday, a Dell lawyer told the Shareholder Forum that it hadn't met the legal standard needed to gain access to confidential assessments that swayed the decision-making process of the company's board.

Order Reprint Print Article
 
Interested in reusing this article?
Custom reprints are a powerful and strategic way to share your article with customers, employees and prospects.
The YGS Group provides digital and printed reprint services for Daily Herald. Complete the form to the right and a reprint consultant will contact you to discuss how you can reuse this article.
Need more information about reprints? Visit our Reprints Section for more details.

Contact information ( * required )

Success - request sent close

The Shareholder Forum, acting on behalf of an unidentified Dell shareholder, is trying to determine if the Round Rock, Texas, company is worth more than the $13.65 per share being offered by its CEO Michael Dell and a group of investors led by Silver Lake.

Gary Lutin, a former investment banker who runs the Shareholder Forum, said he plans to send another letter Wednesday to Dell Inc. in an attempt to clear up any confusion over the legal issues governing the effort to shine more light on the sale negotiations.

Dell had staunchly defended the proposed sale to Michael Dell and Silver Lake as the best deal for the company after evaluating a wide range of other alternatives during a five-month review. The company also is seeking other suitors willing to submit a higher bid.

Investors have been betting that the stakes will be raised. Dell's stock has been trading above the proposed sale price for most of the time since the deal was announced in early February. The shares dipped by a nickel to close Tuesday at $14.32.

The mounting opposition to the proposed deal gained more momentum last week when activist investor Carl Icahn notified Dell that he had acquired a stake in the company in an attempt to come up with a better alternative. Icahn, who hasn't yet disclosed the size of his Dell stake, is pushing the company's board to scrap the sale and pay a special dividend of $9 per share instead. Pursuing Icahn's path would require a show of faith in Dell's plan to boost its recently sagging revenue by expanding into more profitable technology niches beyond the slumping PC market.

Even though the company's financial performance has been weakening as PC sales droop, some shareholders are convinced Dell is worth substantially more than what Michael Dell and Silver Lake are offering.

Southeastern Asset Management, an investment firm that owns the second largest stake after Michael Dell, contends the company is worth nearly $24 a share.

In a separate move Tuesday, Dell granted Southeastern Asset's request for a list of shareholders and other records. That information will make it easier for Southeastern Asset to coordinate a rebellion against Dell's proposed sale, if the board continues to back it at the current price.

The deadline for competing bids to be submitted is March 22.

Share this page
Comments ()
Guidelines: Keep it civil and on topic; no profanity, vulgarity, slurs or personal attacks. People who harass others or joke about tragedies will be blocked. If a comment violates these standards or our terms of service, click the X in the upper right corner of the comment box. To find our more, read our FAQ.