Dell to Open Investor List to Southeastern Amid LBO Opposition
By Dina Bass & Alexis Leondis - Mar 13, 2013 5:35 PM ET
Dell Inc. (DELL) agreed to provide investor information to
Southeastern Asset Management Inc., its largest outside shareholder and
one of the most vocal opponents of a planned $24.4 billion buyout.
Acting on behalf of its $7.7 billion
Longleaf Partners Fund (LLPFX), Southeastern sought access last week
to a list of investors to discuss the deal. Dell will make the information
available, pending a confidentiality agreement, according to a filing
yesterday with the U.S. Securities and Exchange Commission
The fund joins billionaire
Carl Icahn in inspecting confidential Dell information, seeking to
step up pressure on the company to find an alternative to a proposed
buyout by founder
Michael Dell and Silver Lake Management LLC. Southeastern and T. Rowe
Price Group Inc., the second-biggest outside shareholder, say Dell is
undervalued by the $13.65-a-share agreement to be taken private.
The board is seeking bids under a so-called go-shop period that lasts
through March 22, and the deal requires approval from a majority of
shareholders excluding CEO Dell.
Dell fell less than 1 percent to $14.30 at the close in New York, leaving
them 4.8 percent higher than the offer price.
The computer maker denied a request for financial information from Cavan
Partners LP that was sent on the letterhead of the Shareholder Forum, Dell
said in the filing.
David Frink, a spokesman for
Round Rock, Texas-based Dell, said that the company isn’t required to
comply with the request for all communication between advisers and the
company or a committee of its board. Dell plans to disclose more
information about its financial performance and projections, as well as
efforts to find a buyer, by the end of March.
“It surprised me that they seemed to object to what people would consider
the obvious logic of investors having access to the same information that
insiders used to make a proposal,” Gary Lutin, who filed the request for
information and is chairman of the Shareholder Forum, said in a telephone
interview yesterday. “We actually deliberately specified the information
requirements to be exactly the same as what they provided to their own
The Shareholder Forum acts as an independent moderator and doesn’t own
Dell securities, Lutin said. Dell shareholder Cavan Partners, a hedge
fund, gave the Shareholder Forum authority to write the letter.
Lutin responded to the issues raised by Dell as
grounds for its refusal, and reiterated the Shareholder Forum’s request
for information today.
“What concerns us is the need for each of Dell’s stockholders to make its
own independent decisions about its own individual interest, and that is
not something that board members can or should be doing for them,” Lutin
wrote in a
letter to Dell posted on the group’s website.
Icahn has amassed a stake in Dell and is pushing the company to pay a $9 a
share special dividend.
The buyers could boost the offer to $15 a share and still pay the cheapest
multiple among large technology buyouts. At least five analysts see the
buyout group increasing the bid to as much as $14.90 to $15 a share. At
$15, Dell still would be going private at about 5.4 times profit, the
lowest multiple for a technology buyout larger than $1 billion, according
to data compiled by Bloomberg.
contact the reporters on this story: Dina Bass in Seattle at
email@example.com; Alexis Leondis in
New York at
To contact the editor
responsible for this story: Tom Giles at
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