Forum Home Page [see Broadridge note below]

 The Shareholder ForumTM`

Fair Investor Access

See related case examples of

Dell Inc.

appraisal rights for intrinsic value realization

and

Walgreen Co.

stock buyback policies

"Fair Access" Home Page

"Fair Access" Program Reference

For graphs of specific company and related industry returns, see

Returns on Corporate Capital

For graphs of specific company voting for the past 5 years, see

Shareholder Support Rankings

 

 

 

 

For investor interests in information to be exchanged in the private meetings reported below, see

Note: For past Forum attention to shareholder interests in valuations of proposed transactions, see the programs addressing Providian Financial Corporation (2005) and The Bear Stearns Companies (2008).

 

Source: Bloomberg, February 14, 2013 article

Bloomberg.com
Bloomberg
 

Dell Said to Plan Shareholder Meetings to Assess LBO Demands

By Serena Saitto & Jeffrey McCracken - Feb 14, 2013 5:12 AM ET

 

Dell Inc. is setting up meetings with shareholders to assess their demands for getting its $24.4 billion buyout done and also preparing a public response to critics of the deal, said people with knowledge of the situation.

Michael Dell, chairman and chief executive officer of Dell Inc., speaks during the Oracle OpenWorld 2011 conference in San Francisco on Oct. 4, 2011. Photographer: Tony Avelar/Bloomberg

 

A Dell Inc. logo is seen on display at the Mobile World Congress in Barcelona. Photographer: Denis Doyle/Bloomberg

 

Dell and Silver Lake Management LLC are studying ways to address the concerns raised by large shareholders such as T. Rowe Price Group Inc., who said the $13.65-a-share offer undervalues the company. While Silver Lake is opposed to raising the price, one of the people said, the firm wants to meet with shareholders to gauge whether they would expect a bump of more than $1 a share or as little as 15 cents, said another person, who asked not to be identified because the process is private.

In the largest leveraged buyout since the financial crisis, founder Michael Dell and Silver Lake announced Feb. 5 their agreement to take Round Rock, Texas-based Dell private after the company lost almost a third of its value in 2012 amid stiffening competition in mobile and cloud computing. Their offer represents a 25 percent premium to Dell’s closing price Jan. 11, the last trading day before Bloomberg News first reported the buyout talks.

“I don’t think the current offer will get the shareholder vote, especially given the fact that the two largest shareholders have come out early and against,” said Louis Meyer, an analyst at Oscar Gruss & Son Inc.

Dell dropped 0.1 percent to the equivalent of $13.71 in German trading at 11:01 a.m. in Frankfurt. Dell slipped less than 1 percent to $13.77 yesterday in New York, closing above the buyout price for the third day in a row.

Majority Approval

The buyers need approval by a majority of shareholders, excluding Michael Dell, who owns 14 percent of the shares. T. Rowe Price and Southeastern Asset Management together own more than 10 percent of the stock and have said Dell is worth more than its buyers have offered.

David Frink, a spokesman for Dell, declined to comment.

While Dell and Silver Lake weren’t surprised by Southeastern’s response to the buyout, they were caught off guard by how quickly T. Rowe Price and others voiced opposition to the deal, one of the people familiar with the situation said. Dell and Silver Lake are evaluating a public response because they want to halt Southeastern’s momentum, said this person.

Special Dividend

Evercore Partners Inc., which is also running a 45-day go- shop period to gauge whether there’s a superior offer, hasn’t attracted interest from a potential counter-bidder, said the people familiar. KKR & Co. and TPG Capital both conducted due diligence on Dell and aren’t planning to pursue a counter-offer, said one of these people.

A representative for KKR didn’t respond to a message seeking comment left outside normal business hours. Lisa Baker, a spokeswoman for TPG at Owen Blicksilver Public Relations Inc., declined to comment.

The buyers may sweeten their offer by distributing a special dividend, said Gruss’s Meyer. Opposing investors will first push for a higher price, he said. Failing that, they will probably “press for some sort of recapitalization, such as a special dividend.”

The company is supposed to distribute at least one dividend, for 8 cents a share, before the summer, when the deal is expected to close.

To contact the reporters on this story: Serena Saitto in New York at ssaitto@bloomberg.net; Jeffrey McCracken at jmccracken3@bloomberg.net

To contact the editors responsible for this story: Jeffrey McCracken at jmccracken3@bloomberg.net; Tom Giles at tgiles5@bloomberg.net 

©2013 BLOOMBERG L.P. ALL RIGHTS RESERVED.

 

 

 

This Forum program is open, free of charge, to anyone concerned with investor interests in the development of marketplace standards for expanded access to information for securities valuation and shareholder voting decisions. As stated in the posted Conditions of Participation, the Forum's purpose is to provide decision-makers with access to information and a free exchange of views on the issues presented in the program's Forum Summary. Each participant is expected to make independent use of information obtained through the Forum, subject to the privacy rights of other participants.  It is a Forum rule that participants will not be identified or quoted without their explicit permission.

This Forum program was initiated to address issues and objectives defined by participants in the 2010 "E-Meetings" program relevant to broad public interests in marketplace practices, rather than investor decisions relating to only a single company. The Forum may therefore invite program support of several companies that can provide both expertise and examples of leadership relating to the issues being addressed.

Inquiries about this Forum program and requests to be included in its distribution list may be addressed to access@shareholderforum.com.

The information provided to Forum participants is intended for their private reference, and permission has not been granted for the republishing of any copyrighted material. The material presented on this web site is the responsibility of Gary Lutin, as chairman of the Shareholder Forum.

Shareholder Forum™ is a trademark owned by The Shareholder Forum, Inc., for the programs conducted since 1999 to support investor access to decision-making information. It should be noted that we have no responsibility for the services that Broadridge Financial Solutions, Inc., introduced for review in the Forum's 2010 "E-Meetings" program and has since been offering with the “Shareholder Forum” name, and we have asked Broadridge to use a different name that does not suggest our support or endorsement.