Icahn withdrawal clears Dell buyout path

Icahn's withdrawal from an effort to buy out Dell paves the way for CEO Michael Dell and Silver Lake to buy the company

After a long battle, Carl Icahn and associates admitted they were fighting a losing battle and have stepped away from their attempt to buy Dell.

Icahn's withdrawal leaves only a buyout offer from company CEO Michael Dell and associate Silver Lake Partners on the table, who have proposed a deal in which shareholders will get US$13.75 per share and a special dividend of $0.13. Dell's board has recommended shareholders back the Dell/Silver Lake offer and a final shareholder approval vote is set for Thursday.

Icahn and shareholder Southeastern Asset Management had a buyout proposal that they believed was potentially worth $15.50 to $18 a share for current stockholders. In a withdrawal letter to Dell shareholders Monday, Icahn said he was fighting a losing battle and continued to believe the company was being undervalued.

"We therefore congratulate Michael Dell and I intend to call him to wish him good luck (he may need it)," Icahn wrote.

Dell and Silver Lake originally in February proposed to buy the company for $24.4 billion, or $13.65 per share, but the offer was revised twice after shareholder opposition and multiple counteroffers from Icahn. Dell's board delayed the shareholder vote twice, but last month reached a deal with Dell/Silver Lake on revised voting guidelines in which only "yes" or "no" votes would count, with abstentions left out.

Icahn filed a lawsuit in early August with the Court of Chancery of the State of Delaware against Dell's board of directors on shareholder vote delays and requirements of votes considered. However, the court ruled against Icahn, which cleared the path for the final shareholder vote this week.

"We won, or at least thought we won, but when the board realized that they lost the vote, they simply ignored the outcome.  Even in a dictatorship when the ruling party loses an election, and then ignores its outcome, it attempts to provide a plausible reason to justify their actions," Icahn wrote.

Dell's business largely revolves around the deteriorating PC business. The company is trying to increase its presence in the lucrative enterprise market. The company has virtually no presence in the growing smartphone and tablet markets.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags Mergers and acquisitionsbusiness issuesDell

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Agam Shah

IDG News Service
Show Comments

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Cathy Giles

Brother MFC-L8900CDW

The Brother MFC-L8900CDW is an absolute stand out. I struggle to fault it.

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?