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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.


Forum distribution:

Required Dell filing in Forum's Valuation Trust appraisal case identifies investors reserving rights


The article below refers to a "Verified List" of all stockholders demanding appraisal rights that Dell Inc. filed as required by Section 262(f) of the Delaware General Corporation Law in the case of Cavan Partners, LP, a Dell Valuation Trust participant, v. Dell Inc., C.A. No. 9046-CS. A copy of the filing will be provided to Forum participants upon request.

For a similar article, see

Note: Participants in the Forum-supported Dell Valuation Trust do not need to fund the costs of the appraisal process as required in traditionally managed cases to which the article refers, and can also sell or settle their rights at any time. (See the October 8, 2013 Forum Report: Provisions for Dell Valuation Trust Support of Marketable Appraisal Rights.)


Source: Bloomberg, November 27, 2013 article




Dell Appraisals Demanded by T. Rowe to [sic] Magnetar Capital


T. Rowe Price Group Inc. (TROW) and more than 100 other Dell Inc. shareholders who control a combined 47.5 million shares spurned the company’s buyout offer to seek a potentially higher payout through the Delaware court system.

T. Rowe has demanded appraisal on about 30 million shares held in mutual funds and client accounts overseen by the Baltimore-based firm, according to a Nov. 25 legal filing by Dell. Other shareholders who said they may request an independent valuation by the Delaware Chancery Court include Magnetar Capital LLC, an Evanston, Illinois-based hedge-fund firm run by Alec Litowitz; the New York State Common Retirement Fund; and New York-based Loeb King Capital Management. The 47.5 million shares in about 200 shareholder accounts represented 2.7 percent of Dell’s outstanding stock at the time of the buyout.

Founder Michael Dell and private-equity firm Silver Lake Management LLC completed their $24.9 billion buyout of the Round Rock, Texas-based computer company on Oct. 30 after facing months of opposition from investors led by billionaire Carl Icahn and Southeastern Asset Management Inc. Icahn initially said he would demand appraisal rights on about $2 billion of shares he held, only to reverse course last month and accept the offer of $13.75 a share.

Under Delaware law, shareholders who deem a takeover offer too low can petition the chancery court to value their holdings. To exercise this right, shareholders must notify the company that they are demanding appraisal rights prior to a vote on the buyout, and they must refrain from casting their ballot in favor of the transaction.

Changing Course

Shareholders who give notice that they are demanding appraisal rights have 60 days from the completion of the buyout to change their mind and accept the bid. Brian Lewbart, a T. Rowe spokesman, declined to comment on whether the money-management firm would follow through with the appraisal process, which can take several years and cost millions of dollars.

“We are aware of the list of those who plan to exercise appraisal rights and will work within the process” followed by the Delaware courts, David Frink, a Dell spokesman, said in a telephone interview.

In an appraisal, the Delaware court can award an amount higher or lower than the takeover price. Claims are often settled before a ruling.

To contact the reporter on this story: Miles Weiss in Washington at

To contact the editor responsible for this story: Christian Baumgaertel at



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.