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The Shareholder Forumtm

special project of the public interest program for

Fair Investor Access

Supporting investor interests in

appraisal rights for intrinsic value realization

in the buyout of

Dell Inc.

For related issues, see programs for

Appraisal Rights Investments

Fair Investor Access

Project Status

Forum participants were encouraged to consider appraisal rights in June 2013 as a means of realizing the same long term intrinsic value that the company's founder and private equity partner sought in an opportunistic market-priced buyout, and legal research of court valuation standards was commissioned to support the required investment decisions.

The buyout transaction became effective on October 28, 2013 at an offer price of $13.75 per share, and the appraisal case was initiated on October 29, 2013, by the Forum's representative petitioner, Cavan Partners, LP. The Delaware Chancery Court issued its decision on May 31, 2016, establishing the intrinsic fair value of Dell shares at the effective date as $17.62 per share, approximately 28.1% more than the offer price, with definitive legal explanations confirming the foundations of Shareholder Forum support for appraisal rights.

Each of the Dell shareholders who chose to rely upon the Forum's support satisfied the procedural requirements to be eligible for payment of the $17.62 fair value, plus interest on that amount compounding since the effective date at 5% above the Federal Reserve discount rate.

Note: On December 14, 2017, the Delaware Supreme Court reversed and remanded the decision above, encouraging reliance upon market pricing of the transaction as a determination of "fair value." The Forum accordingly reported that it would resume support of marketplace processes instead of judicial appraisal for the realization of intrinsic value in opportunistically priced but carefully negotiated buyouts.



For the Special Committee letter referenced in the article below, see


Source: New York Times DealBook, July 31, 2013 article

Mergers & Acquisitions

Dell Inc. Offers to Move Vote on Buyout, but Refuses to Bend on Voting Rules


Kimihiro Hoshino/Agence France-Presse — Getty Images

Michael S. Dell, the founder of the company that bears his name.

A special committee of the Dell Inc. board said on Wednesday that it would be willing to accept the latest takeover bid by its founder, worth $13.75 a share, if he dropped his demand for a change to the voting rules for his leveraged buyout.

In exchange for dropping the voting rule demand, the Dell directors would move a shareholder vote from Friday to sometime in mid-September. That would also move the record date – the date by which shareholders must have held shares to be considered eligible – to around Aug. 10 from June 3, possibly allowing more investors favorably disposed to the deal to vote and change the tide.

But if Michael S. Dell and his partner, the investment firm Silver Lake, refuse to drop their demand, then a vote on the current bid of $13.65 a share will proceed as scheduled on Friday. That offer would probably fail, given firm opposition from a number of shareholders like the billionaire Carl C. Icahn and a large block of shares that have not been voted – which under the current rules count as no votes.

A person close to Mr. Dell and Silver Lake argued that they were unwilling to budge and now expected that, absent a change to the voting rules, the multibillion-dollar deal would fail. Even changing the record date would not change the mathematics enough to help the proposed takeover succeed, this person said.

Last week, Mr. Dell and Silver Lake proposed raising their proposal – in what they called their best and final offer – by 10 cents, to $13.75 a share, in exchange for the committee declaring that absentee votes would no longer count as no votes. They have argued that the current standard is unfair, since it is hard to determine the intent of absentee votes. They are also motivated by promising signs that they would win if the rule were changed: according to recent tallies of the vote, about 579 million have been cast in favor of the deal, while 563 million have been voted against, people briefed on the matter have said.

The Dell special committee, however, indicated that it would not be willing to change the voting rules for anything less than $14 a share, a person briefed on its deliberations said.

Copyright 2013 The New York Times Company


This project was conducted as part of the Shareholder Forum's public interest  program for "Fair Investor Access," which 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.

The management of Dell Inc. declined the Forum's invitation to provide leadership of this project, but was encouraged to collaborate in its progress to assure cost-efficient, timely delivery of information relevant to investor decisions. As the project evolved, those information requirements were ultimately satisfied in the context of an appraisal proceeding.

Inquiries about this project and requests to be included in its distribution list may be addressed to

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.