Dell Inc. (DELL) To Withhold Information From Carl Icahn Until Board Determines Best Deal

Posted May 20, 2013

Dell Inc. (NASDAQ:DELL) has sent a letter to Carl Icahn and Southeastern Asset Management that they will not be providing more information about the company unless the board has determined that their proposal is “superior” to the one being offered by founder, Michael Dell.  Carl Icahn and Southeastern partnered to offer $12 in cash per share or additional shares to existing investors for Dell earlier this month.  That offered countered Michael Dell’s $24.4 billion bid.

Dell’s special committee of the board of directors said that Carl Icahn and his affiliates made several requests for information including a request for data room access for a potential lender.  “Please understand that unless we receive information that is responsive to our May 13 letter, we are not in a position to evaluate whether your proposal meets that standard,” said the special committee.  Dell sent a letter to Carl Icahn about how he will secure the financing last week.

The letter said that it wasn’t clear if Icahn intended to make “an actual acquisition proposal that the Board could evaluate” or if he intended his offer as an alternative if a sale to Silver Lake / Michael Dell was not approved.

Michael Dell partnered with private equity firm Silver Lake for his deal at a price of $13.65 per share.  Microsoft would also provide Michael Dell and Silver Lake with some financing to secure the deal.  Southeastern and T. Rowe Price believed that Dell’s offer was undervaluing the company.