Forum Home Page see Broadridge note below]

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.



The article below is one of several that were published within minutes of Dell's filing with the SEC of a preliminary proxy statement (SEC EDGAR Filing Details: 2013-03-29 15:49:59), which news organizations had reportedly been told to expect even though Dell's special committee had not yet determined what to propose. For that statement and two related disclosures that were filed soon after (2013-03-29 16:24:32 and 2013-03-29 16:33:49), see

See also two accompanying articles posted by the same reporter at 4:20pm and 6:14pm the same day:


Source: New York Times DealBook, March 29, 2013 article

Hedge Funds | Mergers & Acquisitions | March 29, 2013, 4:04 pm

The Path to a Three-Way Race for Dell


A Dell computer for sale at an Electric Avenue store in Miami, Fla. Joe Raedle/Getty Images

A Dell computer for sale at an Electric Avenue store in Miami

Though the race for Dell Inc. now has narrowed to three contestants, there were many more who arose over a month ago.

Advisers to Dell directors spoke to 71 potential bidders during a 45-day period aimed at flushing out alternatives to a $24.4 billion offer by Michael S. Dell and the investment firm Silver Lake, according to a securities filing by the company on Friday.

The long-awaited proxy filing includes one of the lengthiest recaps of a merger’s history in recent memory, detailing over 26 pages the months-long negotiations that led to the Dell transaction. But it especially shines a light on the 45-day “go-shop” period, which wrapped up last week with two preliminary bids by the Blackstone Group and the billionaire Carl C. Icahn.

Dell is expected to point to the efforts recounted in the proxy as proof that its board fought hard to find the best possible outcome for shareholders, as several investors continue to fight the existing $13.65-a-share bid by Mr. Dell and Silver Lake as far too low.

According to Friday’s filing, bankers at Evercore Partners began reaching out to a panoply of possible strategic and financial buyers shortly after the deal with Mr. Dell was signed on Feb. 5. In total, the investment bank spoke to 21 other companies, 20 private equity firms and 30 other potential investors.

According to the filing, several potential suitors ultimately were rejected because they were interested only in a piece of Dell’s businesses. A special committee of the company’s board was primarily interested in selling the company as a whole, mirroring the proposal by Mr. Dell and Silver Lake.

On Feb. 6, Blackstone contacted Evercore, saying it was interested in participating in the go-shop process. The private equity giant had already expressed interest in potentially bidding for Dell the previous month, after word of the company’s deal deliberations emerged in the press.

A month later, Blackstone, together with potential partners, met with Mr. Dell to further discuss a potential bid.

Other private equity shops emerged as well. The filing names a “Sponsor B” that had previously held discussions with Dell directors late last year, willing to take another look at the company despite passing on making a bid the first time. People briefed on the matter identified that firm as TPG Capital.

Ultimately, TPG decided again not to participate in any bids.

A “Sponsor C” also expressed preliminary interest, but ultimately decided to walk away after inspecting Dell’s books.

A corporate bidder, identified as “Strategic Party A,” contacted Evercore on Feb. 8 to say it was interested in information about Dell’s financial services arm. That company — which people briefed on the matter said was General Electric‘s GE Capital — later expressed interest in working with whatever group Blackstone convened to make a bid.

At least three other strategic buyers sought to gain access to Dell’s books. Most were denied access because they appeared interested in only bidding for part of the company.

Mr. Icahn, who had amassed a position in Dell, first contacted Evercore on Feb. 26 about signing a confidentiality agreement. Over a week later, the billionaire wrote to the Dell special committee, disclosing owning a “substantial” stake and warning that he would fight the proposed takeover by Mr. Dell.

By March 11, Dell advisers gave Mr. Icahn access to Dell’s private financial information.

By the go-shop’s deadline of March 22, Evercore bankers received three expressions of interest. One was from GE Capital, proposing to buy Dell Financial Services only if combined with any takeover proposal, including Mr. Dell’s.

Blackstone also submitted an offer, now known to be over $14.25 a share and which would leave an unspecified portion of Dell public to let investors continue owning a piece of the company if they so wished. The firm disclosed that it was working with Francisco Partners and Insight Venture Partners.

In a twist, however, Blackstone demanded that the Dell special committee reimburse the costs of assembling that rival bid, up to $25 million. That request was granted on Monday.

Mr. Icahn submitted his offer, in which he would buy about 58.1 percent of the company for about $15.6 billion, or $15 a share. His offer envisioned several major shareholders, including Southeastern Asset Management and T. Rowe Price, contributing their stakes as well.

Privately, some Dell advisers considered Mr. Icahn’s proposal a non-starter and a place-holder to keep negotiating with the special committee, according to people briefed on the matter. The hedge fund manager has said that he is reviewing Blackstone’s offer as well, leaving the door open to joining that other consortium.

A version of this article appeared in print on 03/30/2013, on page B3 of the New York edition with the headline: Filing Shows Twisting Path To Three-Way Race for Dell.

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.