Dell Share Price: CEO Wins Shareholder Approval for Buyout

on Sep 13, 2013
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iNVEZZ.com, Friday, September 13: Michael Dell, founder and Chief Executive Officer of PC maker Dell Inc (NASDAQ:DELL), has won approval from shareholders for his $25 billion buyout plan designed to take the company private. His victory, announced on Thursday during a meeting at Dell’s headquarters in Round Rock, Texas, marks the end of a long conflict with the company’s largest investors, led by billionaire investor Carl Icahn and Southeastern Asset Management Inc. This is the largest leverage buyout since Blackstone Group LP took Hilton Worldwide Inc private in 2007.

In yesterday’s afternoon trading Dell shares were flat at $13.85 a share.

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**CEO wins**
A preliminary vote on Thursday granted Dell’s founder and CEO approval for the proposed buyout with the majority of shareholders saying “yes” to the deal that would take the company private in an attempt to turn its fortunes around. Michael Dell and partner Silver Lake Management LLC proposed a leveraged buyout in

February this year, but the offer faced fierce opposition from Carl Icahn, Southeastern Asset Management and T. Rowe Price. In August Dell boosted its offer to $13.88 a share, including a special 13-cent dividend and in return secured a concession from the special board committee on new voting terms that wouldn’t count abstentions as “no” votes. In addition, Icahn, one of the biggest opponents to the deal, bowed out of the conflict stating that it was impossible to win.

The deal is expected to close before the end of third fiscal quarter.
**Turnaround attempt**
Going private will allow Dell to restructure its business without the need to satisfy profit-hungry investors. Dell, the third-largest PC maker in the world, has been struggling in recent years, unable to cope with the decline in the personal computer market amid a consumer shift toward smartphones and tablets. The company posted a 72-percent drop in quarterly earnings last month.

!m[Going Private to offer more Flexibility in Restructuring](/uploads/story/5453/thumbs/pic1_inline.jpg)
Following the vote Michael Dell said that the company plans to invest in the PC and tablet markets, in expanding sales coverage, and in growing its distribution network. He said that the end-user computing segment, defined by devices such as PCs and tablets, was still an important focus for the company, despite the sharp decline in the global market for personal computers.
“We still have a long way to go and many challenges to meet,” he said, as quoted by Reuters. “But under a new private company structure, we will have the flexibility to accelerate our strategy and pursue both organic and inorganic investment without the scrutiny, quarterly targets and other limitations of operating as a public company.”

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