Forum, acting on behalf of an unidentified Dell shareholder, is trying
to determine if the Round Rock, Texas, company is worth more than the
$13.65 per share being offered by its CEO Michael Dell and a group of
investors led by Silver Lake.
Gary Lutin, a former
investment banker who runs the Shareholder Forum, said he plans to
send another letter Wednesday to Dell Inc. in an attempt to clear up
any confusion over the legal issues governing the effort to shine more
light on the sale negotiations.
Dell had staunchly
defended the proposed sale to Michael Dell and Silver Lake as the best
deal for the company after evaluating a wide range of other
alternatives during a five-month review. The company also is seeking
other suitors willing to submit a higher bid.
Investors have been
betting that the stakes will be raised. Dell’s stock has been trading
above the proposed sale price for most of the time since the deal was
announced in early February. The shares dipped by a nickel to close
Tuesday at $14.32.
opposition to the proposed deal gained more momentum last week when
activist investor Carl Icahn notified Dell that he had acquired a
stake in the company in an attempt to come up with a better
alternative. Icahn, who hasn’t yet disclosed the size of his Dell
stake, is pushing the company’s board to scrap the sale and pay a
special dividend of $9 per share instead. Pursuing Icahn’s path would
require a show of faith in Dell’s plan to boost its recently sagging
revenue by expanding into more profitable technology niches beyond the
slumping PC market.
Even though the
company’s financial performance has been weakening as PC sales droop,
some shareholders are convinced Dell is worth substantially more than
what Michael Dell and Silver Lake are offering.
Management, an investment firm that owns the second largest stake
after Michael Dell, contends the company is worth nearly $24 a share.
In a separate move
Tuesday, Dell granted Southeastern Asset’s request for a list of
shareholders and other records. That information will make it easier
for Southeastern Asset to coordinate a rebellion against Dell’s
proposed sale, if the board continues to back it at the current price.
The deadline for
competing bids to be submitted is March 22.
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