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!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection

Tags business issuesDellMergers and acquisitions

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

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

George Khoury

Sharp PN-40TC1 Huddle Board

The biggest perks for me would be that it comes with easy to use and comprehensive programs that make the collaboration process a whole lot more intuitive and organic

David Coyle

Brother PocketJet PJ-773 A4 Portable Thermal Printer

I rate the printer as a 5 out of 5 stars as it has been able to fit seamlessly into my busy and mobile lifestyle.

Kurt Hegetschweiler

Brother PocketJet PJ-773 A4 Portable Thermal Printer

It’s perfect for mobile workers. Just take it out — it’s small enough to sit anywhere — turn it on, load a sheet of paper, and start printing.

Matthew Stivala

HP OfficeJet 250 Mobile Printer

The HP OfficeJet 250 Mobile Printer is a great device that fits perfectly into my fast paced and mobile lifestyle. My first impression of the printer itself was how incredibly compact and sleek the device was.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?