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Icahn Walks Away from Battle for Dell

After a long and protracted battle, activist shareholder Carl Icahn has walked away from his effort to acquire a controlling interest in Dell, though he hasn't backed away from his insistence that shareholders are accepting an inferior deal.

The tide was clearly against Icahn's Southeastern Asset Management with founder and CEO Michael Dell's pending shareholder vote set for Thursday and all indications that its offer, backed by Silver Lake Partners with a lift from Microsoft, had enough support to win. But Icahn maintains the $13.75-per-share deal valued at $25.5 billion undervalues Dell even though they nominally sweetened the deal in July. After a Delaware court last month ruled in favor of the Dell team's contention that needed fewer votes in favor of the deal than Icahn's group claimed, momentum was in the favor of Dell.

"Dell is paying a price approximately 70 percent below its ten-year high of $42.38," Icahn wrote in a letter to shareholders filed with the SEC today. "The bid freezes stockholders out of any possibility of realizing Dell's great potential."

While expressing regret that he was not successful in his bid, Icahn took solace in the fact that he forced Dell to revise the terms of its bid somewhat. "It certainly makes the loss a lot more tolerable in that as a result of our involvement, Michael Dell/Silver Lake increased what they said was their 'best and final offer.'"  

Posted by Jeffrey Schwartz on 09/09/2013 at 12:00 PM


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