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Sources: Dell privatization offer trumped by Icahn, must be raised

updated 11:02 pm EDT, Tue July 2, 2013

Icahn offer pays shareholders $14 per share, extant offer $13.65

According to reports from CNBC, Dell's special committee has examined Carl Icahn's new offer backed by verifiable financing, and is requesting Michael Dell and his cadre of investors raise the standing offer. Icahn's deal will keep the company pubic, and is worth $14 per share, with Michael Dell's current offer to take the company private sitting at $13.65.

Earlier this week, Icahn sent an open letter to Dell shareholders said that he had lined up $5.2 billion in loan commitments to perform a leveraged recapitalization of the troubled computer manufacturer. "With that we put an end to the unwarranted speculation by Dell that our money would not be available," Icahn said in the letter.

On CNBC's Fast Money Halftime Report, Icahn revealed earlier this year that he will nominate a slate of 12 new directors and, if successful, he'll see to it that Michael Dell doesn't remain in his position as chief executive. "He will not be running the company," Icahn said. He did add that it was "not that I have anything against [Michael] Dell. I'm sure he's a very nice guy, but it's a new world out there."

The existing privatization deal requires the majority of the shareholders (not including Michael Dell's shares) to vote in favor of the payout. Southeastern Asset Management, another vocal opponent of the Michael Dell buyout, would lose at least $825 million if the privatization deal completes. Dell has dramatically cut its forecasts for 2013 operating profit by $700 million to $3 billion, casting further shadows over any deal.

by MacNN Staff



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