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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 a printable copy of this report with its referenced letters, click here.

Forum Report: Fair Investor Access (Dell Valuation Project)


Next Week’s Requirements for Dell Appraisal Rights

Immediate priorities for reserving appraisal rights

Provisions for “Review Panel” support of participating investors

Rumor of the week

This holiday week has set the stage for final decision-making in the proposed Dell buyout. While observing the poker plays, shareholders should of course be prepared to choose their own best options.

Immediate priorities for reserving appraisal rights

For any investor who thinks there is any chance of wanting to secure the option of appraisal rights, it is important to immediately initiate the process of delivering the required written demand letter. This seemingly simple administrative task commonly takes about ten business days: a beneficial shareholder has to instruct its custodian to get an authorized person to deliver an executed form to the Depository Trust Company, which in turn prepares a form of letter that is returned to the custodian for delivery to Dell. If that process is not completed prior to July 18, you will not be entitled to appraisal rights.

Remember that if you get the demand letter delivered by the deadline, you can easily cancel the demand for appraisal by either voting in favor of the proposed transaction or withdrawing the demand at any time up to 60 days after the closing of a transaction. But if you fail to get the demand letter delivered, you will not have this choice.

It should be noted that today was the last day the Dell Valuation Trust was accepting responsibility for processing appraisal demands, other than by approval of exceptions, and that independently processed demands will require review by the Trust’s attorneys to be eligible for Trust support.

Provisions for “Review Panel” support of participating investors

To accommodate investor requirements of both being informed and being heard in an appraisal process that was designed before the development of SEC reporting regulations, we have been developing plans for a “Review Panel” as a key element of the Dell Valuation Trust.

  • Members: Any holder or group of holders of 1% of eligible appraisal rights supported by the Trust will be able to delegate a legal or valuation expert to serve on the Panel.

  • Staffing: The Trust will provide staffing and administrative support for all required reporting, research, meeting and other functions of the Panel.

  • Monitoring and access: Members of the Panel will meet with counsel for the appraisal process monthly and as developments require to review the progress of the proceedings and any issues that concern investors, and will have access to confidential information (subject to their acceptance of a conventional confidentiality agreement).

  • Offering views: Members will be expected to offer views for consideration of appraisal counsel and other Members of the Panel, but will not be responsible for actions of the Trust or appraisal counsel.

  • Research: The Panel will be able to request research relating to the interests of appraisal rights holders, including surveys of holder interests.

  • Reporting: Reports will be prepared quarterly and in relation to specific developments the Panel considers worth addressing, and each Member may provide individual comments to be included with the reports. (The reports will of course be reviewed to assure that they do not include any disclosures of confidential information that could make a recipient an “insider.”)

Your suggestions or comments will be welcomed to refine these provisions during the next week.

Rumor of the week

This past week’s most interesting Forum-related rumor was from institutional investors reporting they had heard that I reported they were participating in the appraisal rights project.

For those of you who may not know, publicly posted Forum policies do not allow the identification of any participant without specific permission. Also, the stated conditions of Dell Valuation Trust services restrict disclosures to the requirements of private arrangements. Be assured that I have not violated these policies or any other privacy commitment. You can therefore assume that someone who tells you that I have disclosed something private has either been misled or is doing the misleading. And you should ask yourself why.

The most likely explanation of this week’s misleading statements is that somebody is trying to trick investors into disclosing whether they plan to vote against the buyout as required to secure appraisal rights. Viewing it positively, this level of effort at intelligence gathering should encourage your reliance on the buyout’s proponents to know whether the number of shares demanding appraisal rights is reaching a level that threatens approval of the transaction.

The poker players among you will then be able to read the signals to play your hands.

GL – July 5, 2013

Gary Lutin

Chairman, The Shareholder Forum

575 Madison Avenue, New York, New York 10022

Tel: 212-605-0335




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.