Carl Icahn and Southeastern Asset Management, Dell's biggest
outside shareholder, are launching their campaign to derail a buyout
of the PC maker.
The pair is proposing that the company pursue a leveraged
recapitalization that will pay shareholders a $12-per-share
dividend.
Their rival proposal, which is outlined in a letter to the
company's board, threatens to complicate a bid by founder and CEO
Michael Dell to take the company private.
In February, Michael Dell, who owns a 15.6 percent stake, and
private-equity firm Silver Lake Partners signed a definitive
agreement to buy the company for $13.65 a share, or $24 billion.
Under Icahn's proposal, shareholders could take a dividend equal
to 88 percent of Dell's offer and still keep their shares. They
could opt to have the dividend paid in cash or additional stock.
Icahn and Southeastern are proposing that the company fund the
dividend by repatriating the $9 billion in cash it has sitting
offshore, as well as borrowing money against Dell's account
receivables. Its net account receivables totaled $9.8 billion. In
addition, Dell would be borrowing $5.2 billion. The duo also is
announcing its slate of 12 directors ahead of Dell's annual meeting,
expected to be held in June or July. Shareholders will vote on the
buyout plan and the re-election of directors.
The Post first reported this week that Icahn and Southeastern
would launch a proxy contest in a push to get directors onto the
board.
Originally published by Josh Kosman and Mark DeCambre.
(c) 2013 The New York Post. Provided by ProQuest LLC. All rights Reserved.
