updated 08:10 am EDT, Wed August 18, 2010
SEC filing shows mutiny against Michael Dell
Just over a quarter of Dell's shareholders want company founder Michael Dell out from chairman of the board, an SEC filing late Tuesday revealed. About 25.1 percent of investors refused to vote for Dell's return to the board of directors at last week's annual shareholders' meeting. The lack of confidence was a reflection of protests by the respective unions of the AFL-CIO and American Federation of State, County and Municipal Employees over the company's refusal to fire Dell after settling an SEC suit alleging fraud.
Both the company and Michael Dell were accused by the SEC of hiding kickback payments from Intel intended to guarantee an exclusive and prevent AMD from getting a significant foothold. The company ended up paying $100 million to settle the case, with Dell himself paying $4 million. Neither had to admit wrongdoing, although the subsequent Intel settlement with the FTC for paying off PC builders has indirectly supported the existence of the payments.
The relatively significant opposition is rare as most companies' board leaders are often given near-total support, particularly when the chairperson is an original member of the company. Dell returned to his company in the CEO role in 2007 but has lately been struggling as it has been losing share to Apple, HP and Lenovo in the US and worldwide. The executive also faced a symbolic defeat early into his tenure as, a decade after he said he would have closed Apple were he in charge, Apple had doubled Dell's market cap in late 2007 and now is worth much more despite its smaller computer market share. [via FT]